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2024 (2) TMI 1335 - AT - Income TaxExcess grant of interest contrary to the practice followed by the Department - recomputation of interest u/s 244A - As alleged CIT – A directing the AO to adjust the refund granted first towards interest amount refundable and thereafter consider the balance amount of tax amount refundable - HELD THAT:- CIT – A by directing the AO to verify the details of tax payment submitted by the assessee and the amount of tax paid on period of tax payment to recompute the amount of interest u/s 244A of the act till date of granting of refund. He has further held that in view of the observation of the honourable Supreme Court in [2006 (1) TMI 55 - SUPREME COURT] and the provisions of section 244A should be considered. Nothing was shown to us that how the learned AO is aggrieved when he is directed to recompute the interest by following the decision of the honourable Supreme Court and considering the provisions of the act. Further, coordinate bench decision has also been referred to. Section 244A of the Income Tax Act pertains to the payment of interest on refunds. It states that if the taxpayer is entitled to a refund, they shall be paid an additional interest amount as determined by the Act. According to assessee from the tax refund, nothing is to be reduced and tax and refund already determined should be reduced from interest refund, so that tax on which interest is eligible u/s 244A is always higher than the amount determined by the dl AO because tax amount eligible for interest would always be higher, resulting into higher interest out go. Therefore, we do not find any merit in the appeal of learned AO as ld. AO is directed to verify the claim of assessee in accordance with law - ground of appeal raised is that if the order of the learned CIT – A is followed it will lead to excess grant of interest which is contrary to the practice followed by the Department and the intention of the legislation. We find that the practice followed by the Department should be in consonance with the provisions of the income tax act - Appeal of AO dismissed.
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