TMI Blog2023 (4) TMI 89X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to the assessee vide order u/s 154 of the Act. The impugned order is set aside and appeal of the assessee is allowed. - ITA NO. 549/MUM/2020 - - - Dated:- 21-3-2023 - SHRI G. S. PANNU, PRESIDENT And SHRI VIKAS AWASTHY , JUDICIAL MEMBER For the Applicant : S/Shri Nitesh Joshi Chaitanya Desai For the Respondent : S/Shri Abhijit Chaudhari Somendu Kumar Dash ORDER This appeal by the assessee is directed against the order of Commissioner of Income Tax Appeals-1, Mumbai [hereinafter referred to as the CIT(A) ] dated 06/12/2019 for the assessment year 2012-13. This appeal is arising out of proceedings u/s 154 of the Income Tax Act, 1961 (hereinafter referred to as the Act ). 2. The assessee has assailed the order of First Appellate Authority on following grounds: 1. On the facts and in the circumstances of the case and in law, the learned Assistant Commissioner of Income Tax LTU-1 ( Ld. ACIT ) has erred in passing order u/s 154 dated 9-March-2017 for rectification on an issue involving a debatable point of law and the Hon'ble CITIA) has erred in confirming the action of Ld. ACIT The Ld. ACIT be directed to quash order passed u/s 154 dated 9-M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r dated 12/05/2015 had arisen out of self-assessment tax of Rs.8.70 crores paid u/s 140A of the Act. The AO issued refund aggregating to Rs.3,52,92,707/- including interest u/s 244A of Rs.55,09,832/-. The AO had granted interest u/s 244A of the Act on the amount of excess self-assessment tax of Rs.2,97,82,875/- for 37 months at the rate of 0.5%. Thus, what was refunded to the assessee was self-assessment tax and not the amount of TDS. The learned Counsel referred to the decision of Hon ble Jurisdictional High Court in the case of Stock Holding Corporation of India Limited Vs. N.C. Tiwari CIT, 53 taxmann.com 106 to contend that tax paid on self-assessment would fall u/s 244A(1)(b) of the Act, that is residuary clause covering refunds of amount not following u/s 244A(1) of the Act. Therefore, interest is payable on refund of excess amount paid on self-assessment. The learned Counsel pointed that provisions of section 244A were amended by the Finance Act, 2016 with the effect from 01/06/2016. After the amendment, the condition was imposed that the interest u/s 244A would not be allowed in excess were refund arising out of TDS/TCS, advance tax and self-assessment tax u/s 140A of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2/- by way of TDS credit, advance taxes and self-assessment tax. Thus, the assessee paid excess self-assessment tax of Rs.2,97,82,875/-. On the said excess taxes paid, the assessee claimed interest u/s244A of the Act. In rectification petition filed before the AO on 20/03/2015, the AO vide order dated 12/05/2015 passed u/s 154 of the Act granted interest of Rs.55,09,832/- u/s 244A of the Act. In subsequent order u/s 154 of the Act dated 09/08/2017, the AO withdraws the interest allowed earlier on the ground that interest u/s 244A of the Act is to be granted only if the refund determined is more than 10% of the gross tax payable u/s 143(1) of the Act or under regular assessment. Since, in the case of assessee, the refund was less than 10%, no interest u/s 244A of the Act was payable, hence, there was apparent mistake in granting interest. 8. The provisions of section 244A were amended by the Finance Act, 2016. Prior to amendment by the Finance Act, 2016, there was no embargo of 10% in respect of self-assessment tax paid u/s 140A of the Act. The Finance Act, 2016 amended the provisions of section 244A inter alia inserting clause (aa). The same reads as under: (aa) where the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .4 thereof reads as under: 11.4 The provisions of the new section 244A are as under:- (i) Sub-section (1) provides that where in pursuance of any order passed under this Act refund of any amount becomes due to the assessee then- (a) if the refund is out of any advance tax paid or tax deducted at source during the financial year immediately preceding the assessment year, interest shall be payable for the period starting from the 1 April of the assessment year and on the date of grant of the refund. No interest shall, however, be payable, if the amount of refund is less than 10 per cent of the tax determined on regular assessment. (b) if the is out of any tax, other than advance tax or tax deducted at source or penalty, interest shall be payable for the period starting from the date of payment of such tax or penalty and ending on the date of the grant of the refund. (Refer to example III in para 11.8) (Emphasis supplied) The inferences to be drawn from the Board's circular is clear that if refund is out of any tax other than out of advance-tax or tax deducted at source, interest shall be payable from the date of payment of tax and ending on the date of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns rendered by the Hon ble High Courts held: 48. The next question before us is whether interest is payable on the self-assessment tax paid by the assessee or not. 49. We have gone through the judgment of Hon'ble Jurisdictional High Court in the case of CIT v. Sutlej Industries Ltd [2010] 190 Taxman 136/325 ITR 331 wherein the Hon'ble High Court held that where self- assessment tax paid by the assessee u/s 140A is refunded, the assessee should be entitled to interest thereon The Hon'ble High Court held that the self-assessment tax falls within the expression refund of any amount . The computation of simple interest on self-assessment tax has to be in terms of section 244A(1)(b), ie, from the date of payment of such amount up to the date on which refund is actually granted. The judgment of the Hon'ble jurisdictional High Court was shored up by the judgment of Hon'ble Madras High Court in Cholamandalam Investment Finance Co. Ltd, (supra) the SLP against which order was dismissed by the Supreme Court. 50. Even otherwise, it is trite law that wherever the assessee is entitled to refund, there is statutory liability on the Revenue is to pay the in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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