2008 (7) TMI 1030 - HC - Income Tax

Summary

Issues involved:
The issue involves whether the assessee is entitled to claim interest u/s 244A(1)(b) of the Income Tax Act on excess tax deducted at source and advance tax paid by the assessee.

Judgment Details:

Issue 1: Entitlement to claim interest on excess tax deducted at source and advance tax paid
The assessee filed a return for the assessment year 1990-91, with advance tax paid and tax deducted at source. After assessment under Section 143(3), a demand of Rs. 96,47,333/- was raised, out of which Rs. 70,27,435/- was adjusted against the previous year's refund, and the balance was paid by the assessee. The Commissioner of Income Tax (Appeals) allowed the appeal, resulting in a refund of Rs. 1,81,40,474/-. The Assessing Officer granted interest on a part of the refund but not on the advance tax amount of Rs. 84,93,141/-. The High Court held that as per Section 244A of the Act, the assessee is entitled to interest on excess tax paid or collected by the Department, from the date of the assessment order. Therefore, the Tribunal and the Commissioner of Income Tax (Appeals) were justified in awarding interest on the advance tax amount.

Conclusion:
The High Court found no substantial questions of law in the appeal and dismissed it.