TaxTMI 
TaxTMI 
2017 (7) TMI 1402
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....essing Officer to re-compute the interest by taking the excess tax paid with respect to interest on securities on due basis from the date of order of the Commissioner of Income-Tax (Appeals) to the date of the order under review i.e. 20 July 2010. The learned CIT erred in not appreciating that the appellant is entitled to interest under section 244A in relation to taxation of interest on securities on due basis from 1 April 1999 / date of payment of tax. 4. The learned CIT erred in observing that there was no claim before the Assessing Officer and it was only at the appellate stage that the appellant made a formal claim for taxation of interest on securities oil due basis. 5. The learned CIT erred in not appreciating that after holding that the provisions of section 244A(2) were not applicable, there was no provision under law under which interest under section 244A could he denied to the appellant. 6. The learned CIT erred in not relying on his stand for assessment years 2001-02 and 2002-03, wherein the CIT had directed the Assessing Officer to grant interest under section 244A on this very same issue. 7. Without prejudice to the above, the learned CIT erred in not app....
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....e, which included interest u/s 244A amounting to Rs. 221,39,24,597/-, (ii) while an amount of Rs. 418,52,33,219/- being the interest on securities accrued but not due has been included in the total income declared in the return of income, subsequently relief was sought from the CIT(A) that the same be taxed only on due basis, (iii) the CIT(A) allowed the claim of the assessee that interest on securities be taxed only on due basis and the AO gave the appeal effect vide order dated 04.06.2010 which was subsequently modified by order u/s 154 dated 20.07.2010 wherein the total income was determined by the AO at Rs. 1034,28,27,670/-, (iv) further verification of ITNS 150 of the last referred order u/s 154 reveals that interest u/s 244A has been granted in respect of the so called excess taxes paid on the component of tax pertaining to interest on securities computed on accrued but not due basis from 01.04.1999 to 10.06.2010 i.e. the date of issue of refund resulting out of order u/s 154 of the Act. The CIT came to a finding that (i) the computation was incorrect as no refund arose to the assessee on any excess payment, with reference to the interest on securities at the time of proce....
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....s order u/s 263 that grant of interest u/s 244A in the order dated 20.07.2010 amounting to Rs. 221,39,24,597/- is erroneous, though an amount of Rs. 133,62,88,934/- was already allowed by the AO in the order dated 04.06.2010 giving effect to the order of the CIT(A). The Ld. Counsel of the assessee submits that in the show cause notice, there is no averment or observation of the CIT that the order passed by the AO is erroneous in so far as it is prejudicial to the interest of the revenue. It is submitted by him that the issue was in dispute between the assessee and the Revenue since certain preceding years. The issue is, however, decided in favour of the assessee by the appellate authorities. Reliance is placed by him on the decision in the case of (i) Addl. CIT Special Range vs. ACC Ltd. (ITA Nos. 6279 to 6284/Mum/2010), (ii) CIT vs. Sutlej Industries Ltd. [2010] 325 ITR 331 (Del.), (iii) CIT vs. South Indian Bank Ltd. [2010] 237 CTR (Ker.) 74 and (iv) CIT vs. Assam Roofing Ltd. [2011] 330 ITR 87 (Gau.). 5. On the other hand, the Ld. DR relies on the order of the CIT. He submits that merely a note in the computation of income does not lead to change in the quantum of income r....
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....n before the AO in that regard. He disposed off the application holding that even if the assessee got relief from the appellate authority, it could not get 244A interest that delay was on part of the assessee for making claim, that the claim was not made in the return of income. The assessee approached the CIT and in his order, passed u/s 264 of the Act, he held that prima facie the claim made by the assessee appeared to the genuine. As the AO refused to grant refund as stated earlier, in response to the application filed by the assessee u/s 154 of the Act, so, the assessee filed an appeal before the FAA." The Tribunal allowed the appeal of the assessee and held as under: "The assessee had filed the return of income in the time and the AO or the FAA has not alleged that belated return was filed for the year under consideration. Therefore, it cannot be held that there was delay on part of the assessee. It is observed that that the assessee had in the notes, accompanying the return, had mentioned that in the past Bank's claim for taxing on securities on due basis was allowed up to AY 1990-91, that this year also interest on securities should be taxed on due basis. While complet....
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....to the above, a notice of demand u/s 156 was issued to the assessee. On appeal, the Commissioner (Appeals) allowed the same. Consequently, the AO gave effect to the order of the Commissioner (Appeals). As a result, the assessee was granted a refund of Rs. 2 crores. However, no interest inter alia was granted on self assessment. The assessee preferred a revision application before the Commissioner u/s 264. To the Commissioner partly allowed the assessee's revision application. However, it rejected the assessee's claim for interest of refund of tax paid on self assessment. On writ, the Hon'ble High Court held as under: "7. We have considered the rival submissions. On a bare analysis of Section 244A(1) of the Act it is clear that amount paid by the petitioner as tax on self assessment would not stand covered by Section 244A(1)(a) of the Act. This is so as it is neither the payment of tax by way of advance tax or by way of tax deducted at source. Thus tax paid on self assessment would fall under Section 244A(1)(b) of the Act, i.e. a residuary clause covering refunds of amount not falling under Section 244A(1) of the Act. The revenue contends that in the absence of tax on self assess....