TaxTMI 
TaxTMI 
2019 (10) TMI 1617
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....e Income Tax Act, 1961 (for short the 'Act'). 2. In this case, the appellant/assessee filed rectification application u/s 154 of the Act, pointing out that in the order giving effect to the order passed by the ITAT, interest u/s 244A has not been computed properly and the interest due has not been adjusted first with the refund granted. The AO rejected the application holding that there is no mistake apparent from the order to rectify the same. The assessee challenged the order passed by the AO before the Ld. CIT(A). The Ld. CIT(A) after hearing the assessee dismissed the appeal of the assessee and confirmed the order passed by the AO. The assessee is in appeal before the Tribunal against the said findings. 3. The assessee has challen....
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....he Ld. counsel for the assessee submitted that this issue is covered by the decision of the ITAT in assessee's own case for the assessment years 1996-97, 2000-01 and 2001-02. The Ld. counsel further submitted that since the findings of the Ld. CIT(A) is contrary to the decision of the Tribunal, the same is liable to be set aside. The Ld. counsel invited our attention to the findings of the Hon'ble Delhi High Court in the case of India Trade Promotion Organisation vs. CIT, 361 ITR 646 which has been followed by the Tribunal. 5. On the other hand, the Ld. departmental representative (DR) admitted that the ITAT has directed the AO to adjust the refund in accordance with the ratio laid down by the Hon'ble Delhi High Court referred above, how....
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....ed and held as under:- "The words used in section 244A are "where refund of any amount becomes due and payable to the assessee under the Act", the assessee shall be entitled to receive in addition to the said amount simple interest calculated in the manner stipulated. The Legislature has not used the words "tax paid" or "the principal amount of tax paid". The words used by the Legislature are "any amount" and " said amount". The words are, therefore, much wider and broader than the tax amount, which is to be refunded. The words "any amount" would include within its scope and ambit the interest element, which has accrued and is payable on the date of the refund. Thus, when the Revenue does not pay full amount of refund but part amou....
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....t not refunded. Interest will not be due and payable on the amount refunded but only on the amount which remains unpaid, i.e, the interest element, which should have been refunded but is not paid. In another situation where part payment is made, section 244A would be still applicable in the same manner. For example, if Rs. 60,000 was paid on March 31, 2013, the Revenue would be liable to pay interest on Rs. 1 lakh from April 1, 2010, till March 31, 2013, and thereafter on Rs.40,000. Further, interest payable on Rs. 60,000, which stands paid, will be quantified on March 31, 2013, and on this amount, i.e., interest amount quantified, the Revenue would be liable to pay interest under section 244A till payment is made The aforesaid man....
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....unt and not pay the interest component under section 244A for an unlimited period with impunity and without any sanction, which would amount to granting premium to a non-compliance with law." Thus, respectively following the aforesaid principle we direct the AO to adjust the refund in line of the principle laid down by the Hon'ble Delhi High Court. Accordingly, assessee's ground no. 3 and additional ground is treated as partly allowed for statistical purpose." 7. The coordinate Bench has dealt with the identical issue in assessee's own appeal for the assessment year 1996-97 and vide order dated 11.02.2015 the Tribunal has directed the AO to adjust the refund in accordance with the principle laid down by the Hon'ble Delhi High Co....