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TMI Blog2022 (5) TMI 1410X X X X Extracts X X X X X X X X Extracts X X X X ..... apparent from record and accordingly outside the purview of rectification of mistakes under section 154. 1.2. The learned CIT(A) erred in rejecting the claim of the appellant that two views are possible in this case and hence, it cannot be a case of rectification under section 154. 2. Excess levy of interest under section 234D of Rs. 4,00,73,87 2 2.1. The learned CIT(A) erred in confirming the levy of excess interest under section 234D of Rs.4,00,73,872 for the month of March 2014. 2.2. The learned CIT(A) erred in not appreciating that interest under section 234D is applicable only for 11 months (i.e. from 1 April 2014 to 27 February 2015) as against for 12 months considered by the assessing officer. 2.3. The learned CIT(A) erred in not appreciating that date of grant of refund is same as the date of receipt of refund order / cheque. 2.4. The learned CIT(A) erred in not following the judgement of the jurisdictional Bombay High Court in the case of CIT v. Pfizer Ltd (191 ITR 626) and jurisdiction Mumbai ITAT in the case of Rajashekhar Swaminathan Iyer v. DCIT (73 taxmann.com 228) which are in favour of the appellant taking into consideration the facts of the case. 2.5. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al." 3. The first issue to be decided in present appeal is pertaining to validity of rectification order passed by the Assessing Officer under section 154 of the Act. 4. The brief facts of the case pertaining to this issue, as emanating from the record are: Assessment order under section 143(3) read with section 144C(13) of the Act was passed, in the case of the assessee, on 27/02/2015 determining total income at Rs. 17454,87,39,709. During the audit, it was observed that the assessee was granted refund of Rs. 8471,56,05,701 on 31/03/2014 after summary assessment. However, after scrutiny assessment, due to certain additions, refund to the tune of Rs. 801,47,74,461 was found to be made in excess. Assessing Officer vide rectification order dated 14/03/2017 passed under section 154 of the Act held that assessee was liable for interest under section 234D for a period of 12 months i.e. from March, 2014 to February, 2015. However, as interest under section 234D amounting to Rs. 44,08,12,595 was levied for 11 months only, therefore, there is a mistake which is apparent from the record. As a result, further interest of Rs. 4,00,73,872 under section 234D was levied vide rectification orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under section 143(3) read with section 144C(13) of the Act, Assessing Officer found that interest under section 234D in respect of the excess refund granted to the assessee was levied only for 11 months instead of 12 months i.e. from March, 2014 to February, 2015. As a result, vide rectification order dated 14/03/2017 passed under section 154 of the Act, Rs. 4,00,73,872 was charged as short levy of interest under section 234D of the Act. As noted above, assessee before the learned CIT(A) submitted that the issue, whether interest under section 234D of the Act will be levied from the date of grant of refund or from the date of receipt of cheque of refund, is a debatable issue and thus, is outside the purview of the provisions of section 154 of the Act. The learned AR placed reliance upon the decision of Co-ordinate Bench of Tribunal in Development Bank of Singapore (supra) to submit that the issue is contentious in nature. We find that in Development Bank of Singapore (supra), the Co-ordinate Bench of Tribunal, while holding that interest under section 234D of the Act shall be chargeable from the date of grant of refund, observed as under: "17. The only other ground is against the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sment year to the 'date on which the refund is granted'. Similarly, clause (b) providing for interest in any other case, states that such interest shall be calculated at the specified rate for every month or part of a month comprised in the period or periods from the date of payment of the tax or penalty 'to the date on which the refund is granted'. Thus it is manifest that the terminating point for the calculation of interest u/s 244A is the date on which the refund is granted. It is axiomatic that invariably the actual date of receipt by the assessee will succeed the date of granting or issuance of refund. A cheque for refund with interest having been prepared is signed by the competent authority. After making due entries in the record, it goes for dispatch and only thereafter it is actually received by the assessee. On receipt, the assessee deposits such cheque in his bank account which further takes a few days in realization. So, there is bound to be some time gap between the date of granting of refund and the date of receipt of such refund. In such a situation, the assessee cannot come out with a claim that interest u/s 244A should be allowed up to the date of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the assessee. The legislature in its wisdom has employed the expression "date of receipt" in several sections, such as section 155(8A) before its omission and certain sections providing exemption under the head 'Capital gains'. To claim that the date of receipt of refund should be reckoned as a starting point instead of the date of grant of refund, in our considered opinion, would amount to doing violence to the unambiguous language of the provision. As it is the expression 'date of grant of refund' which has been employed u/s 234D, which in the present case is 29.10.2004, we hold that the interest has been rightly charged from this date. This ground is, therefore, not allowed." 9. Thus, while holding that interest under section 234D shall be charged from the date of grant of refund, the Co-ordinate Bench of Tribunal in the aforesaid decision, inter-alia, referred to the similar expression used in section 244A of the Act. 10. We further find that another Co-ordinate Bench of the Tribunal in M/s Small Industries Development Bank of India v/s DCIT, in ITA no. 3707/Mum/2012, vide order dated 15/09/2017, while holding that interest under section 244A shall be grante ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come Tax Officer v/s Volkart Brothers, [1971] 82 ITR 50, held that for initiating proceedings under section 154 of the Act, the mistake apparent from record must be an obvious and patent mistake and not something which can be established by long drawn process of reasoning on points on which there may conceivably be two opinions. In view of the above and as is evident from the facts available on record, the point on which rectification under section 154 of the Act was done by the Assessing Officer in the present case is capable of divergent views and since, this issue is not alleged to have been settled by any decision of Hon"ble Supreme Court, therefore, we are of the considered view that the present case clearly falls beyond the ambit of the expression "mistake apparent from the record", and thus, the rectification order dated 14/03/2017 passed under section 154 of the Act is set aside. As a result, ground Nos. 1.1 and 1.2 raised in assessee"s appeal are allowed. 12. In view of the aforesaid findings, ground nos. 2.1 to 2.5 raised in assessee"s appeal are rendered academic in nature and are accordingly dismissed. 13. As the scope of the present appeal is limited to the rectifica ..... X X X X Extracts X X X X X X X X Extracts X X X X
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