TaxTMI 
TaxTMI 
2016 (10) TMI 398
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....l income of Rs. 26,29,72,328/-. The return was processed on 09/10/1996. On scrutiny under Section 143(3), the assessment was completed on 02/03/1999. However as per order dated 22/02/2004 and 27/05/2004, interest was not granted under Section 244A on account of the delay in curing the defects in the TDS certificates. Assessee therefore filed an application dated 15/04/2004 before the Chief Commissioner to grant interest under Section 244A on the TDS amount refunded to them as per proceedings dated 27/05/2004. This came to be rejected by the Chief Commissioner on the ground that the delay was attributable to the assessee. Exts.P2, P3 and P4 are similar orders passed with reference to assessment years 1993-94, 1992- 93 and 2001-02. The petitioner appears to have taken up the matter before the Government of India, Ministry of Finance who informed the petitioner that they cannot directly interfere in the matter. It is, in these circumstances, inter alia contending that the delay cannot be attributable to the petitioner that this writ petition is filed. 3. Counter affidavit has been filed by the respondent supporting the stand taken in the matter. It is inter alia contended that submit....
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....ns 214 and 244 of the Act as held by the various High Courts and also of this Court. In the instant case, the appellant's money had been unjustifiably withheld by the Department for 17 years without any rhyme or reason. The interest was paid only at the instance and the intervention of this Court in Civil Appeal No. 1887 of 1992 dated 30.04.1997. Interest on delayed payment of refund was not paid to the appellant on 27.03.1981 and 30.04.1986 due to the erroneous view that had been taken by the officials of the respondents. Interest on refund was granted to the appellant after a substantial lapse of time and hence it should be entitled to compensation for this period of delay. The High Court has failed to appreciate that while charging interest from the assessees, the Department first adjusts the amount paid towards interest so that the principle amount of tax payable remain outstanding and they are entitled to charge interest till the entire outstanding is paid. But when it comes to granting of interest on refund of taxes, the refunds 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 p....
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....refund is out of any tax paid under section 115WJ or collected at source under section 206C or paid by way of advance tax or treated as paid under section 199, during the financial year immediately preceding the assessment year, such interest shall be calculated at the rate of one-half per cent for every month or part of a month comprised in the period from the 1st day of April of the assessment year to the date on which the refund is granted: Provided that no interest shall be payable if the amount of refund is less than ten per cent of the tax as determined under sub-section (1) of section 115WE or sub-section (1) of section 143 or on regular assessment; (b) in any other case, such interest shall be calculated at the rate of one-half per cent for every month or part of a month comprised in the period or periods from the date or, as the case may be, dates of payment of the tax or penalty to the date on which the refund is granted. Explanation.- For the purposes of this clause, "date of payment of tax or penalty" means the date on and from which the amount of tax or penalty specified in the notice of demand issued under Section 156 is paid in excess of such demand. (2) If the....
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....ly or in part. Therefore the first contention is totally out of place. The delay in the proceedings resulting in refund is definitely with reference to the finalisation of returns and not in regard to the proceedings for refund. 10. The other contention urged by the petitioner is that curing defects in the TDS certificates cannot be a reason which could be attributable to the assessee. TDS certificates are issued by the deductor and defects, if any, can be corrected by them only. If mistakes are noted, the same are sent for correction and the time spent for obtaining the corrected TDS certificates and presenting the same before the Income Tax Department shall not be a reason for denying interest. 11. The finding of the Department in Ext.P5 is that there was enough time between the date of obtaining of the certificates and filing of the return for the assessee with its network of officers and infrastructure to get the defects cured. 12. In the counter affidavit filed by the 1st respondent it is submitted that for the assessment year 2001-02, interest was not granted from November 2001 to April 2004. For the assessment year 1992-93, interest was not granted for the period from Jan....