Case Law Details
Alternate Citation- [2011] 16 taxmann.com 291 (Guj.)
Issue Before the Court- Whether in facts and in circumstances of the case the Appellate Tribunal was right in law in reversing the orders passed by the CIT (Appeals) and thereby holding that the assessee was entitled to interest under Section 244A of the Act for both the months when the tax was paid and when the tax refundable was adjusted irrespective of the period between such events?”
Facts of the Case
The respondent assessee had lodged its claim of interest under Section 244A of the Income Tax Act, 1961 (‘the Act’, for short) towards the tax paid which was later on found refundable but adjusted against other dues of the assessee. In short, the stand of the assessee was that under Section 244A of the Act, the asssessee was entitled to receive interest for the whole of the month of payment of tax as well as the month when the same was adjusted regardless of any period or periods remaining in such months. According to the calculation of the assessee, such unpaid interest came to Rs.21,40,420/. Since Assessing Officer did not accept assessee’s claim, the assessee carried the matter in appeal before the CIT (Appeals).
CIT (Appeals) adverting to the provisions contained under Section 244A of the Act, formed an opinion that the words used are “part of a month” and not “parts of months”. He was therefore of the opinion that the assessee can claim interest for full month only for one of the two unfinished months and not for both the months. The CIT (Appeals) therefore by order dated 26th March, 2004 dismissed the assessee’s appeal and confirmed the order of the Assessing Officer.
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