TaxTMI 
TaxTMI 
2015 (6) TMI 569
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....fter hearing the Ld. DR. 3. The assessee in the grounds of appeal has challenged the order of CIT(A) in not directing the Assessing Officer to re-calculate the interest under section 234C of the I.T. Act and in not granting interest on the refund under section 244A of the I.T. Act on self assessment tax paid. 4. Facts of the case, in brief, are that the assessee filed its return of income on 13.10.2006 declaring total income of Rs. 14,93,01,700/-. The Assessing Officer completed the assessment on a total income of Rs. 15,03,07,250/-, which was reduced to Rs. 11,32,07,271/- after giving appeal effect. Accordingly, the tax liability was reduced from Rs. 5,05,93,420/- to Rs. 3,81,05,556/-. The assessee moved an application under section ....
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....n of income furnished by the assessee. He accordingly, held that the Assessing Officer was justified in rejecting the claim of assessee. So far as charging of interest under section 244A of the I.T. Act is concerned, he observed that after appeal effect, refund raised was Rs. 1,39,86,400/-. According to him, the assessee is not entitled to interest under section 244A of the I.T. Act if the refund has arisen out of payment made on account of self assessment tax. The assessee is entitled to interest under section 244A of the I.T. Act only if the refund has arisen out of payment made under sections 115WJ, 199, 206C or advance tax. Distinguishing the decisions cited before him, the CIT(A) rejected the claim of assessee for reduction of interest....
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.... giving the appeal effect. Although the assessee has computed the interest under section 234C of the I.T. Act at Rs. 23,80,997/- on the basis of the returned income, however, the assessed income has been determined at a figure which is below the returned income. Had the assessed income been more than the returned income, there would have been no issue since interest under section 234C of the I.T. Act is to be computed on the basis of returned income. However, the question that arises is as to what will happen if the assessed income is below the returned income. 11. We find the provisions of section 234C of the I.T. Act are as under:- "Interest for deferment of advance tax 234C (1) Where in any financial year,- (a) the company wh....
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.... (b) the assessee, other than a company, who is liable to pay advance tax under section 208 has failed to pay such tax or,- (i) the advance tax paid by the assessee on his current income on or before the 15th day of September is less than thirty per cent of the tax due on the returned income or the amount of such advance tax paid on or before the 15th day of December is less than sixty per cent of the tax due on the returned income, then, the assessee shall be liable to pay simple interest at the rate of [one] per cent per month for a period of three months on the amount of the shortfall from thirty per cent or, as the case may be, sixty per cent of the tax due on the returned income; (ii) the advance tax paid by the assessee on his c....
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....nd the 15th day of December, 2000:] [Provided also that nothing contained in this sub-section shall apply to any shortfall in the payment of the tax due on the returned income where such shortfall is on account of increase in the rate of surcharge under section 2 of the Finance Act, 2000 (10 of 2000) as amended by the Taxation Laws (Amendment) Act, 2001 (4 of 2001) and the assessee has paid the amount of shortfall on or before the 15th day of March, 2001 in respect of the instalment of advance tax due on the 15th day of June, 2000, the 15th day of September, 2000 and 15th day of December, 2000.] [Explanation.-In this section, "tax due on the returned income" means the tax chargeable on the total income declared in the return of income....
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....her the assessee is liable to interest under section 234C of the I.T. Act on the returned income or on the assessed income when such assessed income is lower than the returned income. As mentioned earlier, as per the provisions of the Act, the assessee is liable to interest under section 234C of the I.T. Act for deferment of advance tax on the returned income. However, there are certain exceptions to that. As per the said provisions, the assessee is not liable for interest under section 234C of the I.T. Act on account of any shortfall in the payment of tax due on the returned income where such shortfall is on account of under-estimate or failure to estimate (a) the amount of capital gains or (b) income of the nature referred to in sub-claus....