Interest on Income tax refund cannot be taxed if same is withdrawn subsequently

Lal Nathirmal Moolchandani Vs ITO (ITAT Mumbai) We find that the assessee has received an interest on refund for assessment year 2009-10 in the present assessment year on 31.03.2011. The said cheque was encashed subsequently. Subsequently, vide assessment order passed u/s. 143(3) on 08.12.2011 for the same assessment year a total demand of Rs.24,67,560/- was raised which included the refund granted earlier. Thus, the refund granted earlier stood withdrawn. Hence, the assessee’s claim is that the interest of Rs.1,57,692/- which was received during the financial year 2011-12, was withdrawn by ...