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2019 (1) TMI 600 - HC - Income TaxLevy of interest u/s 234D for the amount of refund - rectification application u/s 154 - whether the provisions of Section 234D introduced with effect from 01.6.2003 is applicable for the assessment years prior to assessment year 2004-05? - Held that:- An order passed under Section 154 cannot be taken to be framing of a regular assessment for such a year. Further, in our opinion, the regular assessment in the assessee's case is the assessment order passed under Section 143(3) of the Act on 30.3.2001. Admittedly, in the said order dated 30.3.2001, there was no levy of interest on the assessee. Furthermore, it is clear that Sub- Section (2) of Section 234D of the Act would be attracted only if reduction occurs and it cannot be made applicable when there is an increase. The Hon'ble Supreme Court, in the case of Reliance Energy Limited [2013 (10) TMI 280 - SUPREME COURT] has held that Explanation (2), which has been inserted by the Finance Act, 2012, in Section 234D of the Act, declared that the provisions of the said Section shall also apply to an assessment year commencing from 01.6.2003 if the proceedings in respect of such assessment year is completed after the said date. Having regard to the legal position, which has been clarified by the Parliament, by insertion of Explanation (2) to Section 234D of the Act, in the said case, where the assessment was completed prior to 01.6.2003, it was held that retrospectivity of Section 234D of the Act does not arise. The above decision would be squarely applicable to the case of the assessee, as, admittedly, the regular assessment was completed under Section 143(3) of the Act much prior to 01.6.2003 i.e. On 30.3.2001. For the above reasons, we are of the view that no interest can be charged under Section 234D of the Act for the assessment year in question. - Decided in favour of assessee
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