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TMI Blog2023 (12) TMI 875X X X X Extracts X X X X X X X X Extracts X X X X ..... al tax component. 3) On the facts and circumstances of the case and in law, the Ld. CIT(A) ought to have held that the Ld. Assessing Officer erred in calculating the refund by appropriating the earlier refunds granted towards the interest as calculated then (i.e., at the time of earlier refunds issued) as against the revised interests computed at the time of granting the latest refund. 4) On the facts and circumstances of the case and in law, the Ld. CIT(A) ought to have held that the Id. Assessing Officer erred in not granting interest under section 244A(1A) of the Act. 5) On the facts and circumstances of the case and in law, the Ld. CIT(A) ought to have held that the Appellant should have been granted interest on interest in view of the inordinate delay in granting of refund. 6) Without prejudice to the above, the Ld. CIT(A) erred in remanding the matter to the Assessing Officer which is violative of section 251 of the Act. 2. The assessee is the principal investment holding company and promoter of Tata companies. The return of income for AY 1993-94 was filed on 31.12.1993 returning NIL income. The return was subject to assessment / reassessment and rectification over a per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... balance, if any, shall be adjusted towards tax payable, meaning thereby, the exchequer should never be deprived of its legitimate dues payable by the assessee in time. However, there is no such specific provision uls. 244A of the Act with respect to adjustment of refund already issued for computing amount of interest payable to the assessee on the amount of refund due. Thus, the law is silent on this issue. Under these circumstances, fairness and justice demands that same principle should be applied while granting the refund as has been applied while collection of tax. 5. The ld AR relied on the decision of the coordinate bench in the case of Union Bank of India v/s ACIT (Mumbai IΤΑΤ) 11.08.2016 72 taxmann.com 348 where it is held that - 3.8 Thus, from the perusal of the above, it is clear that where the amount of tax demanded is paid by the assessee then it shall first be adjusted towards interest payable and balance if any whatever tax payable. Now, if we go through section 244A, we find that no specific provision has been brought on the statute with respect to adjustment of refund issued earlier for computing the amount of interest payable by the revenue to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e left over portion should be adjusted with the balance tax. We find that in the instant case refund was granted to the assessee vide refund order in October 2013 and it was pleaded by the assessee that the said refund is to be adjusted against the correct amount of interest payable thereof to be computed as per the directions of the Ld. CIT(A) and only the balance amount is to be adjusted against tax paid. Accordingly, unpaid amount is the tax component and therefore, the assessee would be entitled for claiming interest on the tax component remaining unpaid. In our considered opinion, the same would not tantamount to interest on interest as alleged by the Ld. CIT(A) in para 4.2 on his order. Similarly, the refund granted to the assessee in July 2016 is to be adjusted against the correct interest payable on the tax amount remaining unpaid and balance towards tax component. We find that this issue is already settled in favour of the assessee by the following decisions of this Tribunal:- a. Decision in the case of Union Bank of India v. Asstt. CIT (2016) 72 taxmann.com 348/162 ITD 142 (Mum.). b. Decision in the case of Bank of Baroda v. Dy. CIT [IT Appeal No. 646 (Mum) of 2017, dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee is justified in seeking interest u/s 244A of the Act upto the date of receipt of the refund order, i.e. 18.08.2022. Accordingly the AO is directed to re-calculate the interest up to the date of actual receipt of refund by the assessee. It is ordered accordingly. 10. The next issue contended pertaining to the interest calculation is that additional interest u/s. 244A(1A) to be calculated on the total amount of refund including Interest. In this regard the ld AR drew our attention to the provisions of sub-section (1A) of section 244A of the Act, in terms of which, when there is a delay in granting refund due to the assessee as a result of delay in passing an order giving effect to the appellate order or revisional order, the assessee is entitled to the additional interest on such amount of refund at 3% p.a. for the period as mentioned therein. The ld AR submitted that the ITAT order, was passed on 04.02.2015 & 01.01.2016 and the present OGE has been passed on 08.03.2016 and refund was received on 18.08.2022. The provision of Section 244A(1A) came into effect from 01.06.2016 and hence from 01.06.2016 to 31.08.2022 there is a delay of 75 months for which the assessee is ent ..... X X X X Extracts X X X X X X X X Extracts X X X X
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