Appellate Tribunal grants Revenue's appeal, orders interest payment to assessee under section 244A

The Appellate Tribunal allowed the Revenue's appeals for statistical purposes but emphasized the delay in refunding the assessee, entitling interest under section 244A. The Tribunal directed the Assessing Officer to calculate interest on the delayed payment based on the method established by the Supreme Court in a specific case.

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Issues:
- Calculation of interest under section 244A on refund due to the assessee.
- Entitlement of the assessee to interest on unpaid interest amount.
- Method of computation of interest under section 244A.

Issue 1: Calculation of interest under section 244A on refund due to the assessee:
The set of eight appeals before the Appellate Tribunal concerned the calculation of interest on refund due to the assessee for various assessment years. The common issue revolved around interest on interest on the refund. The assessee contended that interest on interest should be granted based on the judgment of the Hon'ble Supreme Court of India in a specific case. The CIT(A) allowed the appeal, directing the Assessing Officer to grant interest on 'any interest' due to the assessee.

Issue 2: Entitlement of the assessee to interest on unpaid interest amount:
The dispute centered around whether the assessee was entitled to interest on the unpaid interest amount. The assessee argued that the amount paid should first be adjusted towards interest, and any excess should then be adjusted towards the refund of advance tax paid. The argument was supported by referencing the judgment of the Hon'ble Supreme Court of India in a specific case and a decision of a coordinate Bench of the Tribunal in another case.

Issue 3: Method of computation of interest under section 244A:
The disagreement between the parties was related to the method of computation of interest under section 244A payable to the assessee on the refund amount. The Revenue contended that interest becomes due to the assessee when the Assessing Officer quantifies the refund along with interest. The Revenue relied on judgments of the Hon'ble Delhi High Court and the Hon'ble Madras High Court to support their argument. On the other hand, the assessee argued that the assessee is entitled to interest on the unpaid interest amount. The Tribunal analyzed the judgments and held that the assessee is entitled to interest to be calculated in accordance with the law laid down by the Hon'ble Supreme Court in a specific case.

In conclusion, the Appellate Tribunal allowed the appeals of the Revenue for statistical purposes. The Tribunal emphasized that there had been a delay in making the refund to the assessee, entitling the assessee to interest on the delayed payment of the refund as provided under section 244A. The Tribunal remitted the case back to the Assessing Officer for the calculation of interest on interest arising out of the delay in payment of interest, following the method set out by the Hon'ble Supreme Court in a specific case.

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