TMI Blog2021 (4) TMI 397X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment year 2013-14 is directed against the order of learned CIT(A)-II, Gurgaon dated 11.08.2017. The assessee has raised following grounds of appeal:- 1. Whether in the facts and circumstances of the case and in law the CIT(A) was right in holding that the interest u/s 244A on account of payment of self-assessment tax in respect of the subject assessment year should not be granted, even after clarificatory amendment by Finance Act, 2016 (applicable w.e.f. 01 June 2016). 2. Without prejudice to above, the Ld. AO had grossly erred in not allowing interest on self assessment tax on the order passed by the Ld. AO after 01 June 2016, which was upheld by the Ld. CIT(A). 3. Without prejudice to above, the Ld. AO and Ld. CIT(A) had erred in not following the principle laid down in case of Stockholding Corporation of India Vs N.C. Tewari, CIT reported in (2015) 373 ITR 282 (Bom.) and CIT Vs Birla Corporation Limited (Calcutta High Court) (ITA No.526 of 2004) (order dated 02/02/2016), wherein it has been held that interest u/s 244A is allowable even on Self assessment tax payments, for the assessment years and orders passed prior to the amendment made by Finance Act, 2016 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of the Income tax Act. The amendment to Section 244A sub sections (a) (aa) was made w.e.f 01.06.2016. Therefore, it is very clear that the provisions of Section 244A (i)(aa) will not apply to cases prior to 01.06.2016. The claim of the Appellant cannot be allowed as this case pertains to A.Y.2013-14 and the Self Assessment tax deposited by the appellant was before the cutoff date from which 244A (i)(aa) became effective. Therefore, the appeal of the assessee for allowance of interest u/s 244A(i)(aa) on the refund amount cannot be allowed. 8. From the above finding of Ld.CIT(A), it is clear that the claim of interest was disallowed purely on the ground that the amendment to section 244A sub-section (a) (aa) of the Act was made w.e.f. 01.06.2016 since the present appeal pertains to the Assessment Year 2013-14. Therefore, the amended provisions of section 244A of the Act could not be made applicable for the year under appeal. 9. We have perused the judgement of the Hon ble High Court of Punjab Haryana in the case of CIT vs Punjab Chemical Crop. Protection Ltd. (supra). The Hon ble High Court has held as under:- 8. The aforesaid provision came up for in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see shall be liable to pay such tax together with interest payable under any provision of this Act for any delay in furnishing the return , makes it clear that there is no difference between : (i) the tax paid under section 115WJ, which deals with advance tax in respect of fringe benefits; or (ii) the tax collected at source under section 206C; or (iii) any tax paid by way of advance tax or any tax treated as paid under section 199, which deals with credit for tax deducted, which are provided under section 244A(l)(a). The proviso to section 244A(l)(a) makes it clear that no interest shall be payable if the amount of refund is less than 10 per cent, on regular assessment with regard to the refund of advance tax paid under section 115WJ in respect of fringe benefits ; (ii) tax collected at source under section 206C ; and (iii) advance tax or any tax treated as paid under section 199. But, with respect to other tax as per section 244A(l)(b), the interest shall be payable even if the amount is less than 10 per cent, of the tax as determined under section 143(1) or on the regular assessment, because there is no proviso to section 244A(l)(b) as provided under sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... money. In such a situation, where pre-paid taxes are in excess of the assessed tax, the assessee is entitled to refund of such tax along with interest thereon. Where an assessee out of abundant caution pays selfassessment whilst staking a claim in the return, which claim is accepted, resulting in refund of self-assessment tax, the assessee should be equally entitled to interest thereon. Section 244A was inserted in the statute as a measure of rationalization to ensure that the assessee is duly compensated by the Government, by way of payment of interest for monies legitimately belonging to the assessee and wrongfully retained by the Government, without any gaps. Therefore, in our view where the self-assessment tax paid by the assessee under section 140A is refunded, the assessee should be, on principle entitled to interest thereon since the self-assessment tax falls within the expression 'refund of any amount'. Similar view was expressed by the Delhi High Court in M.M.T.C. Ltd. 's case {supra). 11. It may be observed that in so far as the nature of payment of tax is concerned, the tax deducted at source, advance tax and also tax paid by w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd Investment (P.) Ltd. {supra) the relevant portion of which we reproduce herein : 'So long as the self-assessment tax possesses and retains the character of self-assessment, there is no question of reckoning the same for the purposes of treating it as excess payment and allowing interest as envisaged under section 244A till the regular assessment is made under section 143 or section 144, it is only on the date the assessment is made that the deeming fiction contained under section 244A(2) comes into play and the self-assessment tax is deemed to have been paid towards the regular assessment. It is, therefore, on the date of the regular assessment that the self-assessment tax loses its identity and assumes the character of the tax paid for the purpose of quantification of any excess of tax payment in response to the notice of demand issued under section 156. The explanation appended to section 244A(1) amply clarifies the position as explained above.' From the above, it, therefore, follows that tax paid under section 140A is also taken as paid in pursuance of an assessment after the completion of assessment. 7. Moreover, the rationale of the provisions of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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