9911796707
TMI Blog2012 (11) TMI 810X X X X Extracts X X X X X X X X Extracts X X X X ..... not allowing interest due to the appellant for the period from the date of payment of tax (by way of TDS) up to the date of assessment order i.e. upto 26.03.1987. 2. The learned Commissioner of Income-tax(Appeals) erred in law and on facts in not allowing interest due to the appellant on the amount of 'refund' (comprising both tax and interest).The said 'refund' became due to the appellant on the basis of ITAT's order dated 18.06.1997 and should have been refunded to the appellant within a reasonable time from the said date, but was actually granted on 25.05.2000." 2. Brief facts of the case are that the assessee is a non-resident company incorporated under the laws of Denmark. The assessee has filed return of income claiming refund of Rs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment order. The second contention of the assessee was that the interest has been calculated on the amount of tax only and not on the interest due on the amount of refund, both comprising tax and interest. 4. Learned CIT(A), rejected both the grounds of the assessee after holding that in view of the clear cut mandate of law laid down by the Hon'ble Supreme Court in the case of Modi Industries Ltd. (supra), wherein the Hon'ble Apex Court after analysing the provisions of Section 244(1)A and various other case laws, has held that the advance tax and TDS is to be treated as payment of income-tax in pursuance of the order of assessment on or from the date when these amounts are set off against the tax demand raised in the assessment orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r case laws have been cited. 6. On the other hand, learned Senior DR submitted that the first issue is squarely covered by the decision of the Hon'ble Supreme in the case of Modi Industries Ltd. (supra) and the in the case of Sandvik Asia Ltd. (supra), is clearly distinguishable. On the second issue, he relied upon the findings given by the CIT(A). 7. We have carefully considered the rival submissions and also perused the material on record. So far as the assessee's contention in ground No1 that the interest of refund should be allowed from the 1st of April of the financial year in which TDS was deducted, ie. from 1-4-1984 and not from the date of regular assessment order 26-3-1987, we find that, in assessee's case, provision of section 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovisions of Section 244A will not be applicable in the assessment year 1984-1985. We also do not agree with the contention of the learned counsel that the judgment of the Hon'ble Supreme Court in the case of Sandvik Asia Ltd. (supra), has in any manner diluted the ratio and the proposition of law laid down by the Hon'ble Supreme Court in the case of Modi Industries Ltd.(supra), as in the case of Sandvik Asia Ltd. (supra), the Hon'ble Supreme Court, was besieged with the issue of withholding of refund without sanction of law. Thus, there is no merit in the assessee's ground No.1. Accordingly, ground No.1 is dismissed. 8. In ground No.2, the assessee has challenged that the interest should be paid on the amount of refund delayed from the dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. There is no reason why the refund has been delayed from this period onwards. 8.1 The assessee is entitled for interest u/s 244(1A) in the first step, on the refund from the date of regular order i.e., 26th March 1987 to the date of refund is made to the assessee, as already given by the Assessing Officer and in the second step, the assessee should be granted interest on the total refund due for the period 1st October, 1997 till the date of actual refund is granted, as the effect of ITAT's order dated 8.6.1997 should have been given within three months from the end of June 1997, i.e. before 30th September 1997 as per section 244(1). This granting of interest in the second step, stands covered in favour of the assessee by the judgm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this it is clear that the date of the order granting the refund is the date of the refund voucher itself. The view stated to have been taken by some Income-tax Officers that the date of the assessment order is to be taken as the "date of the order granting the refund" is not correct. Thus, in cases where interest is payable by the Central Government to assessees under section 243, such interest is to be calculated upto the date of issue of the refund voucher." No.20-D(XXII-22), dated 20.8.1968" 8.2 In view of the aforesaid judicial pronouncements and the CBDT Circular, we hold that the assessee is entitled for interest for the amount of refund and interest withheld from the period 1-10-1997 till the date of actual grant of refund voucher. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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