TMI Blog2020 (10) TMI 522X X X X Extracts X X X X X X X X Extracts X X X X ..... .582 OF 2013 - - - Dated:- 7-10-2020 - HON BLE MR. JUSTICE ALOK ARADHE AND HON BLE MR. JUSTICE H.T. NARENDRA PRASAD APPELLANTS (BY Mr. E.I. SANMATHI, ADV.,) RESPONDENT (BY Mr. T. SURYANARAYANA, ADV.,) JUDGMENT ALOK ARADHE J., This appeal under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as the Act for short) has been preferred by the revenue. The subject matter of the appeal pertains to the Assessment year 1987-88. The appeal was admitted by a bench of this Court vide order dated 10.10.2014 on the following substantial questions of law: (i) Whether on the facts and in the circumstances of the case, the Tribunal was justified in law in dismissing the appeal preferred by Revenue by not appreciating the fact that interest on delayed refund interest cannot be granted since there is no specific provision in the Act for payment of interest on the amount of interest and in not considering the fact that the Department has not wrongly retained the refund amount? (ii) Whether on the facts and in the circumstances of the case, the Tribunal is right in law in relying upon the case of CIT v Sandvik Asia Ltd. (SC) wherein interes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther been appreciated by the Commissioner of Income Tax (Appeals) as well as the Income Tax Appellate Tribunal. It is further submitted that even Section 243(1) of the Act also does not provide for grant of interest on interest and the same only deals with interest on delayed payment. It is also urged that even Section 244(1) of the Act does not provide for interest on interest and the decision of the Supreme Court in SANDVIK ASIA LTD. Vs. COMMISSIONER OF INCOME-TAX AND OTHERS (2006) 280 ITR 643 (SC) is not an authority for proposition that interest on interest is payable. It is pointed out that in the aforesaid decision, a petition under Article 226 of the Constitution of India was filed and in the aforesaid petition, the Court had awarded the amount to the assessee by way of compensation as there was a delay in payment of the amount which was due to the assessee. It is also pointed out that the decision in the case of SANDVIK, supra, has been considered by the Supreme Court in COMMISSIONER OF INCOME-TAX, GUJARAT Vs. GUJARAT FLOURO CHEMICALS (2014) 42 TAXMANN.COM 1 (SC) and our attention has been invited to paragraphs 6, 7 and 8 of the aforesaid decision and it has bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ON VS. COMMISSIONER OF INCOME-TAX , (2013) 38 TAXMANN.COM 233 (DELHI). Our attention has also been invited to paragraph 8 of the order in GUJARAT FLUORO supra and it has been submitted that Section 244A of the Act has been inserted, which provides for interest on refunds under various contingencies and it is only the interest provided under the statute which may be claimed by the assessee and no other interest on such statutory interest. It is also urged that GUJARAT FLUORO supra only clarifies the decision of the Supreme Court in SANDVIK ASIA LTD. Reference has also been made to Circular No.549 dated 31.10.1989 and reliance has been placed on decision of the Supreme Court in UNION OF INDIA VS. TATA CHEMICALS LTD. , (2014) 363 ITR 658 (SC). 5. By way of rejoinder, the learned counsel for the revenue submitted that sub-section 244-A of the Act was inserted with effect from 1.4.1989, whereas, in the instant appeal, the assessment pertains to the assessment years 1984-85 and 1987-88. Therefore, the decision relied upon by the counsel for the assessee in the case of HEG Ltd. (supra) and Narendra Joshi (supra) do no apply to the factual situation of the case as the aforesaid c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d of any amount becomes due to the assessee under this Act, he shall, subject to the provisions of this section, be entitled to receive, in addition to the said amount, simple interest thereon calculated in the following manner, namely :- (a) where the refund is out of any tax collected at source under section 206C or paid by way of advance tax or treated as paid under section 199, during the financial year immediately preceding the assessment year, such interest shall be calculated at the rate of one-half per cent for every month or part of a month comprised in the period,- (i) from the 1st day of April of the assessment year to the date on which the refund is granted, if the return of income has been furnished on or before the due date specified under sub-section (1) of section 139; or (ii) from the date of furnishing of return of income to the date on which the refund is granted, in a case not covered under sub-clause (i); (aa) where the refund is out of any tax paid under section 140A, such interest shall be calculated at the rate of one-half per cent for every month or part of a month comprised in the period, from the date of furnishing of return of income ..... 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