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2024 (5) TMI 87 - ITAT KOLKATAInterest u/s. 244A - interest on unpaid interest - refund awarded in the order u/s. 154 - assessee was originally granted the refund with no interest given because the refund was less than 10% of the total tax liability and only in the rectification order that the refund of tax component was given. HELD THAT:- We notice that assessee’s case falls under the category of sec. 244A(1)(a)(i) of the Act because the refund order to the assessee is out of the tax deducted at source upto 31.03.2017 and the assessee had furnished its original return u/s 139(1). Even though the assessee has revised the return but for the purpose of calculating interest, assessee’s return shall always be treated to be filed u/s. 139(1) of the Act. Though the refund in the present case has been awarded in the order u/s. 154 of the Act but even section 154 is also forming part of the fleet of other sections mentioned in sec. 244A(3) of the Act and that comes into action when a refund has already been granted but subsequent to the rectification order, the refund is increased or decreased then the interest given earlier also needs to be increased or decreased. However, in the instant case when the assessee was originally granted the refund no interest was given because the refund was less than 10% of the total tax liability. It was only in the rectification order dated 12.07.2022 that the refund of tax component was given. After considering the facts and circumstances of the case, and also considering the set off of MAT credit available with the assessee as on the beginning of the assessment year, we find sufficient merit in the contentions of assessee that the interest u/s. 244A of the Act in the case of the for AY 2017-18 needs to be computed from 01.04.2017 to the date of grant of refund. Accordingly, the effective issue raised in the instant appeal is allowed. Thus we hold that the assessee indeed is entitled for interest on unpaid interest and accordingly all the grounds raised by the assessee in this regard are allowed.
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