TaxTMI 
TaxTMI 
TaxTMI 
2025 (11) TMI 1514
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.... missed to claim credit of advance tax paid amounting to Rs. 20,00,000/- in the return of income. No credit of advance tax was therefore granted to the assessee as the same remained to be claimed inadvertently by the assessee in his return of income. The assessee, therefore, filed rectification application u/s 154 of the Act on 27.11.2017 with the Assistant Commissioner of Income Tax, Circle-1, Nashik ("Ld. AO"). The Ld. AO accepted the rectification application filed by the assessee and gave credit of advance tax along with interest u/s 244A of the Act amounting to Rs. 4,70,000/-. Accordingly the refund along with interest amounting to Rs. 4,70,000/- was issued on 14.05.2018. Thereafter, the Ld. AO issued a show cause letter dated 16.08.2021 to the assessee proposing for withdrawal of interest u/s 244A in light of Circular No. 9 of 2015 u/s 154/155 of the Act and levy of interest u/s 234D of the Act. The assessee requested the Ld. AO vide letter dated 24.08.2021 to provide a copy of the rectification order dated 02.05.2018 however it was not provided. Thereafter, on 27.08.2021, the assessee filed a detailed legal submission on non-applicability of Circular No. 9/2015 (supra) to th....
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....epresentative or submit his says to this office on or before 27.08.2021. In response to the show cause notice issued the assessee has submitted its reply on dated 24.05. 2021 & 27.08.2021." 3. Aggrieved, the assessee carried the matter before the Ld. CIT(A)/NFAC who upheld the order of the Ld. AO on the ground that denial of interest u/s 244A of the Act is a rectifiable error u/s 154 of the Act and that the delay in granting credit for advance tax is attributable to the assessee as the assessee failed to claim the said credit in the return of income. The relevant findings and observations of the Ld. CIT(A) is as under : "4.3 Ground number 1, 2, 4 and 5 taken by the appellant are with respect to withdrawal of interest granted under section 244A on advance tax which remained unclaimed in the return of income. On the above grounds, the appellant has submitted: "Section 244A, of the Act, inter alia, provides that where any amount becomes due to the assessee, the assessee is entitled to receive said amount along with interest where such refund is out of advance tax." 4.4 Further the appellant submitted: "from the bare, reading of the provision of Section 24....
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....ome. The appellant submits that interest withdrawn by the AO is bad in law and the rectification order should be quashed. 4.5 The appellant has relied on various case laws in favour of his above mentioned arguments. 4.6 As per Section 244A(2). .............. (2) If the proceedings resulting in the refund are delayed for reasons attributable to the assessee 50[or the deductor, as the case may be,] whether wholly or in part, the period of the delay so attributable to him shall be excluded from the period for which interest is payable 51 [under sub-section (1) or (1A)] 51a[or (1B)], and where any question arises as to the period to be excluded, it shall be decided by the 52 [Principal Chief Commissioner or] Chief Commissioner or 52[Principal Commissioner or] Commissioner whose decision thereon shall be final. 4.7 In the case of State Bank of India v. Chief Commissioner of Income-tax [2022] 137 taxmann.com 174 (Kerala) Hon'ble HIGH COURT OF KERALA has held that where assessee-bank claimed interest on refund of TDS amount, since delay in finalisation of return was on account of omission caused in TDS certificates assessee-bank, period taken by ass....
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.... assessee for rectifying the defects or curing the omissions, does not entail the receipt of interest. 4.8 In the case of Kotak Mahindra Finance Ltd. v. Deputy Commissioner of Income-tax [2005] 93 ITD 7 (MUM.) IN THE ITAT MUMBAI BENCH 'H' the Hon'ble Bench has held that 17. We heard both sides in detail. We agree with the learned D.R. that the facts of the present case are quite different from the facts of the case considered by the Mumbai Tribunal in the case of Komaf Financial Services Ltd. (supra). In that case, the assessee was not responsible for the delay. In the present case, the assessee alone is responsible for the delay. Even though the return of income was filed on 31- 12-1992, final set of TDS certificates were filed only in March 1997. The long delay was caused in determining the exact amount of refund because of the delay caused in filing the TDS certificates. We understand that the delay in filing the TDS certificates was beyond the control of the assessee. That may be the aspect of the case. It may be the misfortunate of the assessee that it did not collect the TDS certificates in time. The delay might be beyond the control of the asses....
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....1. In the present case, the final instalment of refund was determined in a proceeding under section 154 as the Assessing Officer had to rectify the assessment order to accomтоdate the final set of TDS certificates produced by the assessee, belatedly. Therefore, it is to be seen that the final instalment of the refund has been determined long after the assessment proceeding was completed. This delay was caused because of the late filing of the TDS return. 22. In the above circumstances, the application of the provisions contained in subsection (2) of section 244A(2) is automatic. The period of delay needed to be excluded from the eligible period considered for the calculation of interest. Therefore, we find that the Assessing Officer has rightly excluded the period of delay. The assessee is not entitled to claim interest on the last instalment of refund from the period beginning from 1st April of the impugned assessment year. 4.9. In view of the above facts and case laws the action of the assessing officer is upheld and the grounds of appeal 1, 2, 4 & 5 of the appellant are dismissed. 5. The 3rd ground of appeal taken by the appellant is ....
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....med as deduction was disallowed. 5.4 Furthermore in the case of CIT Vs. Steel Strips Ltd. [2011] 11 taxmann.com 361 (Punjab & Haryana)/[2011] 200 Taxman 368 (Punjab & Haryana) Hon'ble P & Н High Court has held that overlooking of statutory provision is clearly a mistake apparent on record, and on that basis, rectification under section 154 is clearly admissible. 5.5 Thus in view of the above case laws the 3rd ground of appeal taken by the appellant is dismissed." 4. Dissatisfied, the assessee is in appeal before the Tribunal raising the following grounds of appeal: "On the facts and circumstances of the case and in law, the learned CIT(A) : 1. Erred in upholding the order u/s. 154 of the Act dated 22nd March 2022, by holding that denial of interest u/s. 244A of the Act was rectifiable error u/s. 154 of the Act. 2. Erred in upholding denial of interest u/s. 244A of the Act, amounting to Rs. 20,00,000/-, by holding that the delay in granting credit for advance tax was on account of the Assessee as it had failed to claim the said credit in the return of income. 3. Failed in not appreciating the fact that the credit for....
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....pparent from record 7. Ajanta Manufacturing Ltd. v. DCIT [2017] 391 ITR 33 (Gujarat HC) 23-29 8. Grasim Industries Ltd. v. DCIT [2022] 197 ITD 542 (Mumbai - Trib.) 30-34 9 DBS Bank Ltd. v. DDIT [2016] 176TTJ 293 (Mumbai - Trib.) 35-39 II. Power to decide on denial of interest u/s. 244A is entrusted with the Chief Commissioner of Income-tax or Commissioner of Income-tax and in absence of any such decision the AO has to mandatorily grant interest u/s. 244A 10. Ajanta Manufacturing Ltd. v. DCIT [2017] 391 ITR 33 (Gujarat HC) 23-29 11. CIT v. South Indian Bank Ltd. [2010] ITA No. 1714 of 2009 (Kerela HC) 40-43 12. Grasim Industries Ltd. v. DCIT [2022] 197 ITD 542 (Mumbai - Trib.) 30-34 13. DBS Bank Ltd. v. DDIT [2016] 176TTJ 293 (Mumbai - Trib.) 35-39 III. Delay in making a claim does not amount to delay in proceedings attributable to the assessee 14. PCIT v. Bank of Baroda [2023] 294 Taxman 455 (Bombay HC) 44-46 15. CIT v. Melstar Information Technologies Ltd. 2019] 265 Taxman 50 (Bombay HC) 47-49 16. ....