TMI Blog2009 (6) TMI 913X X X X Extracts X X X X X X X X Extracts X X X X ..... re reason the appeal has to be decided within the parameters of statutory law. Appeal dismissed. - M.A.I.T. NO. 55 OF 2003 - - - Dated:- 25-6-2009 - DIPAK MISRA AND K.S. CHAUHAN, JJ. For the Appellant : A.P. Shrivastava and Sapan Usrate. For the Respondent : Rohit Arya and Sanjay Lal. ORDER:- PER : Dipak Misra The present appeal preferred under section 260A of the Income-tax Act, 1961 (hereinafter referred to as the Act ) was admitted on the following substantial question of law : "1.Whether the appeal before the First Appellate Authority was maintainable in law? 2.Whether in the facts and circumstances of the case, the Tribunal was justified in holding that as refund has been issued under Circular No. 285 independently of the Income-tax Act, 1961, the appellant is not entitled for interest on the refunded sum?" 2. The facts which are essential to be stated for the purpose of adjudication of this appeal are that the appellant, M/s. Universal Cables Limited, erroneously deducted the tax out of interest payments made to IDBI regard being had to the provisions contained in section 194A(3)(iii)( b) of the Act. The Tax Deducted at Source (for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6,022. While addressing the said issue the Tribunal came to hold that the present appellant had deducted the interest payment payable to IDBI Bombay which is covered under section 194A(3)(iii)( b) and, therefore, no tax was deducted on interest payment. The Tribunal referred to Board s Circular No. 285, dated 21-10-1980 and the provisions contained in sections 237, 243, 244A and 244SS of the Act and came to hold that the provisions contained in sections 243, 244 and 244A pertain to grant of interest on delayed refund. It has further expressed the view that the tax refunded by the Department is not a refund as per section 237 of the Act and, therefore, there is no occasion to claim interest under section 244A of the Act. The Tribunal came to hold that the refund was made on the basis of a circular of the Board and, therefore, interest is not payable. Being of this view, the Tribunal allowed the appeal of the revenue. 7. We have heard Mr. A.P. Shrivastava, learned counsel along with Mr. Sapan Usrate, Advocate for the appellant and Mr. Rohit Arya, learned senior counsel along with Mr. Sanjay Lal, Advocate for the respondent revenue. 8. Though a question had been framed whether the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is on section 244A which clearly postulates that refund of any amount becomes due to the assessee under this Act. 10. To appreciate the aforesaid submissions raised at the Bar, it is appropriate to refer to section 2(7) of the Act. It reads as under : "2(7) assessee means a person in respect of whom any proceeding under this Act has been taken for the assessment of his income or assessment of fringe benefits or of the income of any other person in respect of which he is assessable, or of the loss sustained by him or by such other person, or of the amount of refund due to him or to such other person; (b)every person who is deemed to be an assessee under any provision of this Act; (c)every person who is deemed to be an assessee in default under any provision of this Act." 11. In this context, we may refer with profit to section 201 which reads as follows : "201. Consequences of failure to deduct or pay. (1) where any person, including the principal officer of a company : (a)who is required to deduct any sum in accordance with the provisions of this Act; or (b)referred to in sub-section (1A) of section 192, being an employer, does not d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble to be deducted TDS and it failed to do so, therefore, the order under section 201(1) and 201(1A) was passed raising a demand amount and tax was paid. The order was passed in the appellate proceedings under the Act. The High Court applied sub-section (1) of section 244 of the Act for determining the interest for the period in question. Their Lordships dealing with the question whether the Delhi Development Authority was assessee or not the Apex Court expressed the view as under : From the above provision, it is clear that term "assessee" includes actual assessee as well as deemed assessees under the provision of the Act. It is therefore, not correct to contend that unless there are actual assessment proceedings pertaining to any person, he cannot be considered to be an assessee. In the present case the DDA was considered to be liable to deduct the tax at source. It failed to do so. Hence, the order under sections 201(1) and 201(1A) was passed raising the demand and the amount of tax was paid. The order of refund was passed in appellate proceedings under the Act attracting section 240 of the Act. Certain decisions were cited at the Bar to show the meaning of the words "assess ..... X X X X Extracts X X X X X X X X Extracts X X X X
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