TaxTMI 
TaxTMI 
1987 (7) TMI 156
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....nce was also placed in Delhi High Court decision in National Agricultural Co-operative Marketing Federation of India Ltd. v. Union of India [1981] 130 ITR 928. The department relied on the orders of the authorities below. 2. After carefully considering the submissions, we are of the view that the claim of the assessee is reasonable and should be allowed. The provisions of section 140A (2) clearly provides that after a regular assessment under section 143 or 144 has been made, any amount paid under sub-section (1) shall be deemed to have been paid towards such regular assessment. Section 244(IA) talks of interest payable as a consequence of refund that has been granted to the assessee in pursuance of an order of assessment. Therefore, reading of the provisions of the above sections, the claim of the assessee has only to be allowed. The Delhi High Court in the case of National Agricultural Co-operative Marketing Federation of India Ltd. have made categorical observation that since as a consequence of an assessment made, the tax that are paid as advance tax has to be treated as amounts paid as a consequence of an assessment. Therefore, we allow this appeal of the assessee. Per S....
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.... 255(4) OF THE INCOME-TAX ACT. Consequent upon the difference of opinion the matter is being placed before the Hon'ble President for proceeding in the matter in the light of the above section. The difference of opinion is as under : "Whether on the facts and in the circumstances of the case the assessee was entitled to interest u/s 244(IA) of the Act on the refund due out of the self-assessment tax paid ?" THIRD MEMBER ORDER Per Dr. S. Narayanan, Vice President (WZ) - A difference of opinion having arisen between the Members, who originally heard this appeal, the, matter has come to be referred to me by the President under section 255(4). The point of difference is as under : "Whether on the facts and in the circumstances of the case, the assessee was entitled to interest u/s. 244(IA) of the Act on the refund due out of self-assessment tax paid ?" 2. The assessee is a Pvt. Ltd. Company. The assessment, for this year was completed on18-9-1978on a total income of Rs. 3,20,630. The assessee had made the following payments as self-assessment tax (under sec. 140A) : Date ....
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....ing been paid by him after the 31st day of March, 1975, in pursuance of any order of assessment or penalty and such amount or any part thereof having being found in appeal or other proceeding under Act to be in excess of the amount which such assessee is liable to pay as tax or penalty. as the case may be, under this Act, the Central Govt. shall pay to such assessee simple interest at the rate specified in sub section (1) on the amount so found to be in excess from the date on which such amount was paid to the date on which the refund is granted." The further points made by the Commissioner (A) were as follows : (i) The term "other proceeding" found in sec 240 was comprehensive enough to cover the proceedings under sec. 154 also (Sec. 240 provides that "where as a result of any order passed in appeal or other proceeding under this Act, refund of any amount becomes due to the assessee, the ITO shall, except as otherwise provided in the Act, refund the amount to the assessee without his having to make any claim in that behalf). (ii) The contention that interest on refund cannot be allowed because payments were made under sec. 140A and not in pursuance of a regular assessment....
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....in law in holding that self-assessment tax paid u\s. 140-A is not a payment in pursuance of an order assessment." 6. The learned Accountant Member, who wrote the leading order, held as under : (a) The payment of Rs. 61,800 was made after1-4-1975. It was self-assessment tax. In the light of sec. 140-A (2) it had to be taken as a payment made in presence of a regular assessment. Sec. 140-A (2) provides that after a regular assessment under section 143 or sec. 144 has been made any amount paid under sec. 140-A (1) (self-assessment tax) shall be deemed to have been paid towards such regular assessment. (b) Sec. 244(IA) read with sec. 140-A (2) authorised payment of interest on the self-assessment tax paid by the assessee. (c) The above position was in line with the decision in National Agricultural Co-operative Marketing Federation of India Ltd.'s case. The assessee's appeal would, therefore, succeed. 7. The learned Judicial Member, however, disagreed. According to him, the Commissioner (A) was correct in denying interest on the self-assessment tax paid. He made the following points in his order : (a) Sec. 244(IA) is a special section dealing with a situation arising ....
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....nt and in satisfaction thereof. Thus, the advance-tax paid earlier will get converted into a payment on the date of the initial assessment of the tax due for the assessment year." 9. Shri Butani referred to sec. 219 in this regard. That provides that any sum (other than penalty or interest) paid or recovered from an assessee as advance-tax in pursuance of Chapter XVII shall be treated as a payment of tax in respect of the previous year relevant for the assessment year concerned and credit therefor shall be given to the assessee in the regular assessment. The point stressed by Shri Butani in this regard is that when one compares the language of section 219 with that of section 140-A (2), it would be seen that the position stated by section 140-A (2) is even clearer and expressed in stronger language. In other words, applying the ratio of the National Agricultural Co-operative Marketing Federation of India Ltd.'s case, the assessee's claim here should succeed without doubt. No doubt, as the learned judicial Member has stated in his order it bears the character of the self-assessment tax up to the completion of the assessment, but only up to that stage. Thereafter, it loses that id....