TaxTMI 
TaxTMI 
2017 (5) TMI 308
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....he assets were attached to be dealt with as per orders of the Special Court. 3. The consequential assessments made under the Act in respect of each of the Petitioners entailed their paying the substantial amounts towards tax and interest. By a communication dated 29th August 2006 the Assistant Commissioner of Income Tax ('ACIT'), Central, Circle-19, New Delhi requested the Custodian (Special Court) for recovery of the income tax demand. 4. By an order dated 19th March 2008 the Department recovered in the case of Preeti Aggarwala (the Petitioner in W.P. (C) No. 1011 of 2016) a sum of Rs. 3,74,323 towards interest under Section 220(2) of the Act for the AY 1998-99 by adjusting the refund due for AY 1992-93. In respect of Naresh Kumar Aggarwal (the Petitioner in W.P. (C) No. 1012 of 2016) the dues in respect of taxes and interest were recovered by the Respondent from the Custodian under the orders of the Special Court by debiting the attached account of the said Petitioner and also by adjusting refunds due for other AYs 2002-03, 2004-2005 and 2006-07. In respect of Brisk Capital Market Services Ltd. (the Petitioner in W.P. (C) No. 1183 of 2016) the dues in respect of taxes and i....
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.... Act i.e. on 30th March 2015 and the resultant refund was issued to you on 30th April 2015. The obligation to refund money received and retained without right implies and carries with it the right of interest also whereas charging of interest under Section 220(2) for non payment of tax within the stipulated period is mandatory and as such department was very much within its right to collect and retain the amount of interest. According to the provisions of Section 244A (1) (b) of the Act, interest is allowable in cases where refund of any amount becomes due to the Assessee under this Act whereas the refund on account of waiver under Section 220 (2A) is not under any statutory provisions of the Act. Further the judicial pronouncements quoted by you have been perused carefully and is found that the facts of your case are not squarely covered with facts of the case laws relied upon by you. 4. In view of the facts and the provisions of the Act, you are not entitled to the interest under Section 244A and your application under reference is rejected." 7. Thereafter, the present three writ petitions were filed seeking the quashing of the above orders dated 3rd August 2015 and for a d....
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....would apply only in the cases of refund of tax and penalty and not any other amount. 11. Mr. Manchanda pointed out that the waiver of interest by CCIT was discretionary. There was no delay in actually issuing the refund orders once the CCIT passed the refund order dated 30th March 2015. Further, since CCIT had waived the interest payable by the Petitioners, the question of their incurring a financial loss did not arise. There was no general mandatory rule that every amount of refund made by the Department to an Assessee must carry interest thereon. Reliance was placed on the decision of this Court in Commissioner of Income Tax v. Engineers India Limited (2015) 373 ITR 377 (Del). 12. Mr Manchanda submitted that the decision of the Supreme Court in Union of India v. Tata Chemicals Limited (supra) was distinguishable on facts. There the issue was about TDS having been wrongfully deducted whereas in the present case interest under Section 220 (2A) of the Act was charged due to failure on the part of the Petitioners to pay the demand raised under Section 156 of the Act for various AYs within the time limits in terms of Section 220 (1) of the Act. He relied on the decision of the S....
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....y month or part of a month comprised in the period,- (i) from the 1st day of April of the assessment year to the date on which the refund is granted, if the return of income has been furnished on or before the due date specified under sub-section (1) of Section 139; or (ii) from the date of furnishing of return of income to the date on which the refund is granted, in a case not covered under sub-clause (i) (aa) Where the refund is out of any tax paid under Section 140A, 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 date of furnishing of return of income or payment of tax, whichever is later, to the date on which the refund is granted: Provided that no interest under clause (a) or clause (aa) 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 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....
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....Limited (supra) the question that arose was whether the Income Tax Appellate Tribunal (ITAT) was justified in granting interest under Section 244A of the Act on the refund arising due to excess payment on self-assessment of tax. It was held that Section 244A does not mandate that interest cannot be allowed on self-assessment tax paid under Section 140A of the IT Act. Relying on the decisions in Commissioner of Income Tax v. Cholamandalam Investment and Finance Company Limited (2007) 294 ITR 438 (Mad), ACIT v. Kerala Transport Company (2014) 222 Taxman 149 (Ker), Commissioner of Income Tax v. Mangalam Arts (2013) 218 Taxman 51 (Raj), CIT v. Punjab Chemical & Crop Protection Limited (2015) 231 Taxman 312, and that of the Calcutta High Court in Commissioner of Income Tax v. Birla Corporation Limited (supra) where it was held that "it cannot be said that interest under Section 244A can be allowed only in cases where excess payments of tax is made consequent to a notice of demand under Section 156. The language of the Act is clear and there is no ambiguity in it. Hence the Assessee is clearly entitled to claim interest under Section 244A on refund of excess self-assessment tax." 20. ....
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....courts must interpret the provisions of the Statute upon ascertaining the object of the legislation through the medium or authoritative forms in which it is expressed. It is well settled that the Court should, while interpreting the provisions of the Statute, assign its ordinary meaning. 24. This Court in Shyam Sunder vs. Ram Kumar (2001) 8 SCC 24 has observed that in relation to beneficent construction, the basic rules of interpretation are not to be applied where (i) the result would be relegislation of a provision by addition, substitution or alteration of words and violence would be done to the spirit of legislation, (ii) where the words of a Provision are capable of being given only one meaning and (iii) where there is no ambiguity in a provision, however, the Court may apply the rule of beneficent construction in order to advance the object of the Act. 25. Before the insertion of Section 244A as a composite Section by the Direct Tax Laws (Amendment) Act, 1987, the liability to pay interest on refund of pre-paid taxes was contained in Sections 214, 243 read with Section 244 (1A) of the Act. The Parliament has introduced a new Section in the place of Sections 214, 243 and....