TMI Blog2023 (1) TMI 615X X X X Extracts X X X X X X X X Extracts X X X X ..... against the interest refund due and thereafter against the tax refund due? - HELD THAT:- There was identical issue in case of Karsanbhai Kachrabhai Patel HUF [ 2022 (12) TMI 1083 - ITAT AHMEDABAD] where decided the issue in favour of the assessee. Before us, no material has been placed on record by the Revenue to demonstrate any contrary decision of the Higher Judicial Authorities. Before me, Revenue has not placed any material on record to point out any distinguishing feature in the facts of the case for the year under consideration and that of the case cited above nor has placed any contrary binding decision in its support. Thus respectfully following the above allow the ground of appeal of the assessee. - ITA Nos. 411-412/AHD/2022 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee is that the learned CIT (A) erred in holding that the refund issued is to be segregated into tax refund and interest refund and be adjusted accordingly. 4. The facts in brief are that the assessee in the present case is a Trust and filed the return of income having tax liability at Rs. Nil for AY 1983-84. Nevertheless, the assessee has paid the advanced tax amounting to Rs. 37,500/-. However, the dispute arose between assessee and revenue with respect to the income tax liability. In between, the assessee deposited further tax amount and the refund was also issued. Finally, the dispute settled in favour of the assessee and taxes paid became due to be refunded along with interest. The AO in while computing the final refund of taxes a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arlier was short granted by the revenue. Thus the issue arises whether the assessee can claim the recovery of the interest amount first out of the refund granted by the revenue or the same should be adjusted towards the principal amount of tax refund. At the outset, I find that there was identical issue before me in case of Karsanbhai Kachrabhai Patel HUF bearing ITA No. 183/Ahd/2022, where I have decided the issue in favour of the assessee vide order dated 21-12-2022 by observing as under: 7. We have heard the rival contentions of both the parties and perused the materials available on record. There is no dispute to the fact that the assessee has paid advanced tax of ₹ 1,71,780/- whereas the income was determined at rupees NIL. Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cond instalment of refund. 7.3 On the contrary, the revenue was of the view that the amount of refund for ₹ 76,920/- should be treated as adjustment against the principal amount and the balance amount of ₹ 32,490/- should be adjusted against the interest of ₹ 76,872/- only. Thus, the issue arises whether the assessee can claim the recovery of the interest amount out of the refund granted by the revenue or first the principal amount should be adjusted against the refund granted by the revenue. This controversy has been answered by Mumbai tribunal in the case of Union Bank of India vs. ACIT reported in 72 taxmann.com 348 wherein it was held as under: 3.10 It is noted from the observations of the Hon'ble Supr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the amount of refund granted to the assessee, first, has to be adjusted against the interest payable to the assessee in the given facts and circumstances. 7.5 We are also conscious to the fact that the AO has made a reference in his order to the judgment of the Hon ble Supreme Court in the case of Gujarat Flouro chemicals reported 24 taxmann.com 338 wherein the issue was different than the case on hand. The Hon ble Supreme Court has directed as under: 8. The argument in Sandvik Asia Ltd. (supra) on behalf of the assessee was that it was entitled to compensation by way of interest for the delay in payment of the amounts lawfully due to it which were wrongly withheld for a long period of seventeen years. Vide Paragraph (23) o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e light of the aforesaid discussion and as per the provisions of law. Hence, the ground of appeal of the assessee is allowed. 10.1 Before us, no material has been placed on record by the Revenue to demonstrate any contrary decision of the Higher Judicial Authorities. Before me, Revenue has not placed any material on record to point out any distinguishing feature in the facts of the case for the year under consideration and that of the case cited above nor has placed any contrary binding decision in its support. Thus respectfully following the above finding I hereby allow the ground of appeal of the assessee. 10.2 In the result, appeal of the assessee is allowed. Coming to ITA No. 412/Ahd/2022 for A.Y. 1984-85. 11. At the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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