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2009 (7) TMI 872 - AT - Income TaxRectification of mistakes - Interest on refund of self assessment tax - as per the Explanation as well as the decision in Modi Industries Ltd (1995 -TMI - 5478 - SUPREME Court). by the Supreme Court, the tax paid as self-assessment tax becomes a payment of tax pursuant to a notice of demand issued on adjustment against demand on assessment and accordingly the interest on the refund to an assessee out of self-assessment tax is to be granted under s. 244A of the Act - issue will be taken as debatable one on that ground and, therefore, the AO had no jurisdiction to rectify his earlier order dt. 7th June, 1999 in exercise of powers vested under s. 154 of the Act. - the notice under s. 154 issued by the AO on 6th June, 2000 proposing to withdraw the interest allowed as per order under s. 154 of the Act dt. 7th June, 1999 was illegal and bad in law. Regarding interest on interest on delayed refund - Sec. 244A grants interest only on that amount of refund that is out of the tax paid by the assessee or collected from him and not on the amount due to the assessee but withheld by the Revenue, such as interest due which though included in the amount of refund under s. 240 of the Act by virtue of certain decisions referred to above - it is held that assessee was not entitled to any interest on interest as it was not a case of the refund of amount out of any tax paid by or collected from the assessee nor it has a date of payment by the assessee from which it can run.
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