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2015 (9) TMI 1354 - ITAT AHMEDABAD

2015 (9) TMI 1354 - ITAT AHMEDABAD - TMI - Grant interest U/S.244A on the self assessment tax paid - Revenue’s case is that self assessment tax in question is not entitled for section 244A interest and the same is further allowable in advance tax/TDS/TCS and taxes paid in compliance to a demand notice u/s. 156 - CIT(A) allowed interest - Held that:- View favouring the assessee holding self assessment tax to be entitled for section 244A interest has to be adopted in this backdrop of conflicting j .....

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; 15,401/- nowhere germane to the issues raised in the instant appeal. The same is accordingly rejected. - Decided against revenue

Interest on interest - Held that:- As decided in CIT, Gujarat vs. Gujarat Fluoro Chemicals [2013 (10) TMI 117 - SUPREME COURT] it is only that interest provided for under the statute which may be claimed by an assessee from the Revenue and no other interest on such statutory interest. We follow the hon’ble apex court’s decision and hold that the CIT(A) has .....

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proceedings under section 154 of the Income Tax Act, 1961; in short the Act . 2. The following grounds are raised in the instant appeal:- 1 The CIT(A) has erred in law and on facts in directing the A.O. to grant interest U/S.244A on the self assessment tax paid, without considering the legal position that from 01.04.1989 interest u/s.244A is allowable only on advance tax/TDS/TCS and taxes paid in compliance to notice of demand issued u/s.156 of the Act. 2 The CIT(A) has erred in law and on facts .....

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.89 is allowable u/s.244A and there is no provision for considering the interest due on refund as tax paid for the purposes of allowing interest u/.s.244A. 2.3 The CIT(A) has erred in law and on facts while directing the A.O. to grant interest on interest without considering the fact that the Hon'ble Supreme Court granted interest as a compensation under writ jurisdiction and the CIT(A) has no such powers. 2.4 The CIT(A) has failed to consider the decision of Ahmedabad ITAT in the case of GS .....

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argument raised in the course of hearing are three fold. The first one is that the CIT(A) has wrongly held the assessee to be entitled for section 244A interest. The second one is that the Assessing Officer had observed that the assessee did not furnish proof of tax payment causing delay in issuing refund. This findings is stated to have been ignored in the lower appellate order. The third and last argument is that the CIT(A) has wrongly ordered interest on interest to be paid to the assessee a .....

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s first ground on the issue of interest on self assessment tax of ₹ 27,16,377/- on 13-12-1989 as per challan forming part of the case file. The assessee filed a rectification dated 16-04-2003 before the Assessing Officer qua giving effect order dated 24-01-2003 and claimed interest u/s. 244A from date of payment till receipt refund order dated 04-03-2005 received on 05-04- 2003. The assessing authority passed its order on 10-09-2004 holding that section 244A is not allowable on the impugn .....

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aw by observing that the same pertained to section 214 holding the field before 01-041989 whereas section 244A was applicable after the said crucial date. 7. The assessee preferred appeal in second round of litigation. The CIT(A) quotes case law as was stated in his earlier order (supra) and holds that the assessee self assessment in question is entitled for section 244A interest. 8. We have heard both the parties and gone through the case file. The Revenue s case is that self assessment tax in .....

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assessee s favour holding self assessment tax to be entitled for section 244A interest are (2007) 214 ITR 438 (Madras) CIT vs. Cholamandalum Investment and Finance and Bombay High Court in Stock Holding Corporation Vs. CIT in Civil Writ Petition No. 823 of 2000 decided on 17-11-2014 relating to assessment year 1994-95. The Revenue s special leave petition against the former judgment stands dismissed in the hon ble apex court. On other hand, hon ble Delhi high court in CIT vs. Engineers India Ltd .....

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e s first substantive ground is rejected. 9. Now we come to Revenue s second argument that the CIT(A) has ignored the Assessing Officer s findings alleging the assessee to have caused delay in refund on account of non-furnishing of proof of tax payment. We find that this ground nowhere forms part of adjudication in the lower appellate order. It is evident that the Assessing Officer s relevant findings are only in the context of section 244A interest on TDS payment of ₹ 15,401/- nowhere ger .....

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v. CIT [2006] 280 ITR 643/150 Taxman 591, a bench of two learned Judges has referred the following question of law for our consideration and authoritative pronouncement by order dated 28.08.2012: "The question which arises in this case is, whether interest is payable by the Revenue to the assessee if the aggregate of installments of Advance Tax OF TDS paidexceeds the assessed tax?" 2. In the aforesaid order of reference, this Court has briefly noticed the facts and the discussion in Sa .....

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he aforesaid issue before us, we have carefully gone through the judgment of this Court in Sandvik Asia Ltd. 's case (supra} and the order of reference. We have also considered the submissions made by the parties to the lis. 4. We would first throw light on the reasoning and the decision of this Court on the core issue in Sandvik Asia Ltd. 's case (supra). The only issue formulated by this Court for its consideration and decision was whether an assessee is entitled to be compensated by t .....

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nd of certain amounts to an assessee while disposing of an appeal, revision etc. 5. Since, there was an inordinate delay on the part of the Revenue in refunding the amount due to the assessee this Court had thought it fit that the assessee should be properly and adequately compensated and therefore in paragraph 51 of the judgment, the Court while compensating the assessee had directed the Revenue to pay a compensation by way of interest for two periods, namely; for the Assessment Years 1977-78, .....

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other words, the interpretation placed is that the Revenue is obliged to pay an interest on interest in the event of its failure to refund the interest payable within the statutory period. 7. As we have already noticed, in Sandvik Asia Ltd. 's case (supra) this Court was considering the issue whether an assessee who is made to wait for refund of interest for decades be compensated for the great prejudice caused to it due to the delay in its payment after the lapse of statutory period. In th .....

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