Case Law Details
Sandvik Asia Limited V/s. CIT (OSD)- ITAT Pune – Interest on the refund is really a part of the refund and interest and refund are not two different things. When the Income-tax Officer has passed the order under section 154 of the Act without granting interest due to the assessee under section 244[1A] of the Act, he has reduced the refund due to the assessee. We are not able to accept the view that clause [f] of sub-section [1] of section 246 should be limited only to the case where the refund was granted earlier but was reduced by an order passed under section 154 of the Act.
Since we are of the view that the interest forms part of the refund and where the interest is not granted in an order passed under section 154 of the Act, the order in substance and effect meant that the Income-tax Officer has passed an order under section 154 of the Act reducing the refund. The decision of the Madhya Pradesh High Court also proceeds on the basis that an order not granting refund is referable to section 237 of the Act and since the interest forms part of the refund the order refusing to grant interest is relatable to section 237 of the Act and it is appealable. Thirdly, where there is a total denial by the Revenue to grant interest on the refund due, on the basis of the decision of the Andhra Pradesh High Court, an appeal provisions should be construed in a reasonable manner and viewed in any manner, we are of the view that the order of the Income-tax Officer refusing to grant interest due to the assessee is an appealable order under section 246 of the Act
IN THE INCOME TAX APPELLATE TRIBUNAL “A” BENCH, PUNE
BEFORE SHRI R.K. PANDA, AM AND SHRI VIKAS AWASTHY, JM
ITA No. 1420/PN/2005- Assessment Year : 1997-98
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Here is a case of a group of assessees where they are due to receive sizable amounts of refunds + interest. The claims had reached the stage of High Court and Hon’ble High Court permitted the I T Department to adjust the demands due as claimed before it from out of funds deposited in a bank with a lien to the department in December 2006. The department did not appropriate the demands claimed as due till date. In fact the group of assessees are due to receive refunds + interest. The AO is not issuing the refunds on flimsy grounds. The matter went to level of CBDT in the form of a grievance petition and also to Parliament. Yet either the AO or the range head or CIT or CCIT are not issuing refunds and sending all sorts of incorrect reports. They have also not given any reason for non-appropriation of funds lying in bank as deposit with lien to the department. Surprisingly none of the above authorities are not questioning why such appropriation was not done. The pleas of the assessees are not being attended. Ultimately some day the refunds were to be issued with higher amounts of interest u/s 244 causing erosion in to the other tax payers genuine payments. Who is to be blamed in this?