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2021 (7) TMI 1391 - AT - Income TaxAllowability of interest on refund u/s 244A - delay attributable to the assessee - period for which interest is to be allowed - refund in relation to interest reimbursement under TUFS ( Technology Upgradation Fund Scheme) - contention of the assessee is there is no delay attributable to the assessee at all and that the only delay recognized by section 244A(2) of the Act relates to delay in proceedings attributable to the assessee - HELD THAT:- In the case of Chetan N. Shah vs. M. K. Moghe Commissioner of Income Tax [2014 (9) TMI 1177 - BOMBAY HIGH COURT] the Hon’ble Bombay high court held that there is no provision for rejecting the claim of interest on account of a mistake by the assessee. That such a proposition would render the section otiose since excess taxes paid originate on account of some mistake either on fact or law on the part of the assessee. That it is only delay in disposal of proceedings resulting in refund attributable to the assessee which are not to be compensated with interest. The delayed claim of the assessee therefore cannot be said to tantamount to delay in proceedings resulting in refund attributable to the assessee. In the case of HHA Tank Terminal( P) ( ltd) [2019 (2) TMI 1515 - KERALA HIGH COURT] the assessee had already been granted refund on processing of its return u/ s 143 ( 1 ) of the Act and subsequently it had filed a revised return claiming further refund. In this backdrop of facts the Hon’ble court held that the later refund could only relate back to the filing of revised return. We have no hesitation in holding that the assessee was entitled to interest on the refund generated for the entire period of delay as envisaged under the provisions of section 244 A (1) (b) of the Act that there was no delay attributable to the assessee in the proceedings resulting in refund and, therefore, the provisions of section 244 A( 2 ) of the Act were not attracted in the present case. The order of the Ld. CIT( A) holding so is held to be not in accordance with law. Argument of the assessee that the Ld. CIT( A) had no power to restore the matter to the AO, we do not find any merit in the same since the Ld. CIT( A) has only given a direction to the AO to refer the matter to the Ld. Pr. CIT, which surely does not tantamount to restoring the issue to the AO. This argument of the Ld. Counsel for the assessee is therefore dismissed. Contention of the Ld. DR that since the Ld. CI T( A) had not adjudicated the issue, having directed the AO to refer the matter to the Ld. Pr. CIT, no appeal lay against this order, we do not find any merit in the same. The limited scope of the power with the Ld. Pr. CIT, as per sub section (2) of section 244 A, is determination of period of delay attributable to the assessee. He has no power to decide the entitlement of grant of refund. The direction of the Ld. CIT( A) to the AO to make a reference is only to this limited extent, which arises and could have arisen only while holding the assessee not entitled to grant of interest for the entire period of delay. I t is this order of the Ld. CIT( A) which has been challenged before us. The argument of the Ld. DR therefore that the order of the Ld. CIT( A) could not have been challenged is clearly devoid of any merits and is thus dismissed. Assessee appeal allowed.
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