TaxTMI 
TaxTMI 
2011 (1) TMI 885
X X X X Extracts X X X X
X X X X Extracts X X X X
.... was completed on 23.3.2006 for the assessment years 1998-99 to 2003-04 under Section 153A and assessment for the year 2004-05 under Section 143(3) of the Act. Ultimately, it was held by the assessing officer that there was no tax liability. As pleaded, the assessee entered into communication with the assessing officer for return of Rs.17,00,000/- (Rupees Seventeen Lakhs only) vide letter dated 11.12.2006 and finally, the amount was refunded on 15.4.2008. Thereafter, the assessee-petitioner represented for grant of interest and the revenue granted interest @6% amounting to Rs.1,91,704/- (Rupees One Lakh Ninety One Thousand Seven Hundred Four only) on 16.5.2008 covering the period from 7.5.2004 to 23.3.2006. This was as per Section....
X X X X Extracts X X X X
X X X X Extracts X X X X
....As the same was not addressed to, the present writ petition has been filed for grant of interest for the said period on the capital sum as well as the interest on interest. We have heard Mr. Ankur Saigal, learned counsel for the assessee-petitioner and Mr. Sahni, learned counsel for the revenue. Learned counsel for the petitioner has commended us to the decisions in Suresh B.Jain v. P.K.P. Nair & Ors. [1992] 194 ITR 148 (Bom.), CIT v. Narendra Doshi, [2002] 254 ITR 606 (SC), D.J.Works v. Dep. CIT, [1992] 195 ITR 227 (Guj.), CIT v. Hynoup Food & Oil Industries Ltd., [2010] 320 ITR 365 (Guj.), Sandvik Asia Ltd. v. CIT & Ors., [2006] 280 ITR 643 (SC), CIT v. Jawahar Lal Rastogi, [1970] 78 ITR 486 (SC), Bhagwan Prasad Agrawal v. CIT & Ors., ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s are first adjusted towards the taxes and then the balance towards interest. Hence as per the stand that the Department takes they are liable to pay interest only upto the date of refund of tax while they take the benefit of assessees funds by delaying the payment of interest on refunds without incurring any further liability to pay interest. This stand taken by the respondents is discriminatory in nature and thereby causing great prejudice to the lakhs and lakhs of assessees. Very large number of assessees are adversely affected inasmuch as the Income-tax Department can now simply refuse to pay to the assessees amounts of interest lawfully and admittedly due to them as has happened in the instant case. It is a case of the appellant as set....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the injury directly and proximately caused by a breach of contract or duty; remuneration or wages given to an employee or officer." There cannot be any doubt that the award of interest on the refunded amount is as per the statute provisions of law as it then stood and on the peculiar facts and circumstances of each case. When a specific provision has been made under the statute, such provision has to govern the field. Therefore, the court has to take all relevant factors into consideration while awarding the rate of interest on the compensation. This is the fit and proper case in which action should be initiated against all the officers concerned who were all in charge of this case at the appropriate and relevant point of time and becaus....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... 1986 to March 27, 1998 within one month from today failing which the Department shall pay the penal interest at 15 per cent. per annum for the above said period." As noticed above Rs. 17 lacs were seized under Section 132 of the Act on 11th September, 2003. Block assessment was initiated for assessment years 1998-99 to 2003-04 under Section 153 A of the Act. Block assessment order was passed on 23rd March, 2006 and there was no additional tax liability. Assessment order for the assessment year 2004-05 was passed under section 143(3) of the Act but without creating any further liability. Thus, in accordance with section 132 B (4) the amount of Rs. 17 lacs along with interest became refundable. This amount should have been refunded....