TMI Blog2008 (6) TMI 291X X X X Extracts X X X X X X X X Extracts X X X X ..... ,53,516 received from the parties after filing of the return of income and filed during the assessment proceedings i.e. before finalization of the assessment constitutes delay attributable to your appellant within the meaning and for the purposes of curtailing period for interest on refund under sub-s. (2) of s. 244A of the IT Act. (ii) Having regard to the facts and circumstances, it be held that there is no delay attributable to your appellant in relation to TDS certificates for Rs. 3,53,516 and your appellant is entitled to interest thereon as provided in s. 244A of the Act." 2. There was an order under s. 154 of IT Act dt. 31st Dec., 2003 wherein as per the assessee interest under s. 244A was incorrectly computed by excluding the tax credit amount of Rs. 34,74,781 as per s. 115JAA(5) For the sake of completeness the impugned tax calculation as made by the AO in the said order passed under s. 154 is reproduced below: Tax payable as under: Amount of tax payable as LTCG per s. 112(1) in accordance with proviso 10% of capital gain of Rs. 5,28,24.684 Rs. 52,82,468 without indexation Tax on other income of Rs. 16,25,782 Rs. 5,69,0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons of s. 154 and an order was passed on 31st Dec., 2003 quantifying the total income as it was declared and there was no change in the tax payable as well. In consequence the refundable tax was computed at Rs. 67,03,949 and a refund order of Rs. 50,43,506 was issued. However, the grievance of the assessee was that while calculating the interest under s. 244A, the AO has calculated the interest on an amount of Rs. 9,88,797 and did not allow any interest on Rs. 34,74,781 being the tax credit admissible under s. 115JAA(5) of the MAT paid. 3. After hearing the submissions of the assessee, the learned CIT(A) has referred the proviso to s. 115JAA(2) for the reason that no interest shall be payable on the tax credit as allowed under sub-s. (1) of the s. 115JAA. According to him, the said proviso prohibits the allowance of any interest on the amount of tax credit allowable under s. 115JAA. The action of the AO was upheld. Now, the appellant is in further appeal. 4. From the side of the appellant, learned Authorised Representative Shri C.A. Gulamikar appeared. He has argued that in terms of s. 115JAA(4) the credit for MAT is to be allowed to be set off in a year when tax becomes payabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TTJ (Chd) 767: (2005) 92 ITD 441 (Chd). 5. From the side of the Revenue Shri Ajitkumar Shrivastava, learned Departmental Representative has supported the orders of the AO and CIT(A). Basically he has referred the said proviso to sub-s. (2) of s. 115JAA and argued that the impugned amount was rightly reduced from the refundable amount for the purpose of granting of interest under s. 244A of IT Act. 6. Submissions of both the sides have been heard at length. Case records perused. The precedents cited are carefully examined. As regards the introduction of s. 115JA, the Finance (No. 2) Act, 1996 has inserted this new section so as to levy a minimum tax on companies who are having "book profit" and paying dividends but are not paying advance tax. The scheme envisages the payment of minimum tax MAT by deeming 30 per cent "book profit" computed under the Companies Act, as taxable income, in a case where the total income as computed under the general provisions of IT Act is less than 30 per cent of the "book profit". Where total income under the normal provisions of the Act is more than 30 per cent of the "book profit", tax shall be charged on the same. Since this provision begins with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d after the completion of assessment and credit of the MAT has to be granted then as per the referred proviso the assessee shall not be allowed interest on the said tax credit i.e. MAT. Thereafter the normal procedure for computation of tax or refund comes into play that is after the adjustment of advance tax or TDS amount. At the cost of repetition we may like to put our observation in simple words that on perusal of s. 115JA, it reveals that the assessee who has paid tax under s. 115JA is entitled to set off and carry forward of tax so paid in excess of the tax payable on its total income computed in accordance with the other provisions of the Act and thereafter as per sub-s. (4) of s. 115JAA provides for set off of tax credit as paid or as already paid under s. 115JAA in a year when tax becomes payable on the total income computed in accordance with the other provisions of the Act. other than s. 115JA. It is also well-settled that an assessee is accordingly entitled to pay advance tax after availing the set off of MAT credit. The result is that the assessee is entitled to set off of MAT credit at the stage at which the tax has become payable. So the question of non-payment of in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is that the TDS certificates amounting to Rs. 3,53,516 were furnished on 26th Dec., 2003 though the return was filed on 29th Oct., 2001 and the intimation was completed under s. 143(1) on 26th Dec., 2002. The AO has granted the claim of TDS of the said amount and thereupon a total refund of Rs. 43,17,094 was computed however. while calculating the interest under s. 244A the said TDS amount was reduced for the purpose of computation of interest. 8. When this issue was reached before the first appellate authority, learned CIT(A) has held that the delay in furnishing of TDS certificate was on the part of the assessee which resulted in delay in computation of refund hence, that mistake which was attributable to the assessee should not be passed over to the AO. By referring the provisions of s. 244A(2), learned CIT(A) has held that the AO has rightly disallowed the interest to the assessee. 9. We have heard the submissions of both the sides and also carefully perused the impugned computation. The applicable section is s. 244A for the purpose of granting the interest on refund and sub-s. (2) prescribes that if the proceedings resulting into refund are delayed for reasons attributable ..... X X X X Extracts X X X X X X X X Extracts X X X X
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