TMI Blog1986 (6) TMI 33X X X X Extracts X X X X X X X X Extracts X X X X ..... nces of the case, the Appellate Tribunal was right in law in holding that the order under section 154 falls under section 240/244(1A) and that the proceedings under section 154 are 'appeal or other proceedings' ? (2) Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal was right in law in holding that the assessee is entitled to interest under section 244(1A)? " Mr. Srinivasan, learned counsel for the Revenue, is not very much particular about getting the answers for the above questions. Obviously, he has not got much to say, against the view taken by the Tribunal. Counsel, however, concentrated primarily on the maintainability of the appeal against the order of the Income-tax Officer made under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such interest was payable only on orders passed on appeal or revision and not on the refund entitled to by an order under section 154 of the Act. The assessee preferred an appeal against the order made under section 154 contending that interest should have been allowed along with the refund granted. The Appellate Assistant Commissioner did not allow the appeal. Thereupon, he preferred a further appeal to the Tribunal. The Tribunal accepted the contention of the assessee. It was of the opinion that the assessee would be entitled to interest even if the refund is allowed upon rectification of the assessment order, since the rectification proceedings would be "other proceedings" as envisaged under section 244(1A) of the Act. On the questi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions. " From the above provisions, it will be seen that all orders, under section 154 or 155 have not been made appealable. The orders which are appealable have been classified into three categories: (i) those having the effect of enhancing the assessment, (ii) those having the effect of reducing a refund, and (iii) an order refusing to allow the claim made by the assessee either under section 154 or 155. The first category which we have set out is totally inapplicable and, indeed, it was also not relied upon by Mr. Chandra Kumar, learned counsel for the assessee. Counsel, however, strenuously relied on the second category, i. e., an order under section 154, which has the effect of reducing a refund. Counsel urged that the assessee was en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... first place. Secondly, from the statement of facts, it will be seen that there was no claim made by the assessee regarding the interest before the rectification order was made. Such a request was made only on December 29, 1980, claiming interest under section 244(1A) of the Act, whereas the assessment was rectified on December 8, 1980. That apart, the assessee under section 154 could only ask for a refund and he cannot ask for interest even before refund is allowed. The provisions relating to refund and interest to be charged are quite distinct and different. In Chapter XIX, sections 237 to 241 deal with refund. Sections 243 and 244 deal with interest on refund or delayed refund. These provisions are independent. It may be, as the Tribuna ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome-tax Act, reducing the amount of refund payable to the partners. In any case, his order can also be construed as an order which refused to allow the assessees' claim for interest on the refund amount to which they would have been entitled on the rectification made under these two sections. Such an order of the Income-tax Officer clearly falls within section 246(1)(f) and is appealable. " It will be seen from the above observations that an order under section 154 granting refund without the interest allowable would amount to reducing the amount repayable to the assessee or reducing a refund and, therefore, such an order could be construed as an order under section 154 read with section 155 of the Act. With respect, we are unable to agre ..... X X X X Extracts X X X X X X X X Extracts X X X X
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