ACIT, CHENNAI V. K.S.Aghoram, CHENNAI

ITA 1152/CHNY/2016

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 8825 (ITAT-CHENNAI)
• Duration Of Justice: 2 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-07-2016
• Appeal Filed By: Department
• Bench Allotted: C
• Assessment Year: 2008-2009
• Appeal Filed On: 28-04-2016
• Court: TRIBUNAL
• Department Lawyers: A V SREEKANTH J
• Assessee Lawyers: B RAMAKRISHNANC A
• Keywords: Revised return
• Section: 244A; 153A; 234B; 147; 148; 263; 144; 154; 139

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : CHENNAI , . !' BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SHRI G.PAVAN KUMAR, JUDICIAL MEMBER ./ I.T.A.NO.1152/MDS./2016 / ASSESSMENT YEAR : 2008-09 ASSISTANT COMMISSIONER OF INCOME TAX,CORPORATE CIRCLE 4(2), CHENNAI 600 034. VS. SHRI K S AGHORAM , 54,THIRUMALAI ROAD, T.NAGAR,CHENNAI -17. [PAN AAFPA 5850 K ] ( #$ / APPELLANT) ( %&#$ /RESPONDENT) / APPELLANT BY : MR.A.V.SREEKANTH,JCIT,DR /RESPONDENT BY : MR.B.RAMAKRISHNAN,C.A / DATE OF HEARING : 12 - 07 - 201 6 !' / DATE OF PRONOUNCEMENT : 15 - 07 - 2016 ' / O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER THIS APPEAL OF THE REVENUE IS DIRECTED AGAINST TH E ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-6, CHENNAI DAT ED 22.02.2016 PERTAINING TO ASSESSMENT YEAR2008-09. 2. THE GRIEVANCE OF THE REVENUE IS WITH REGARD TO GRANTING OF INTEREST U/S.244A ON PAYMENT OF SELF-ASSESSMENT TA X. ITA NO.1152/MDS./16 :- 2 -: 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESS EE IS A DIRECTOR OF SSI LIMITED AND FILED ITS RETURN OF INCOME ON 29.09 .2008 ADMITTING INCOME OF ` 94,65,23,041/- AND PAID TAXED OF ` 17,10,58,258/-. SUBSEQUENTLY THE ASSESSEE FILED A REVISED RETURN ON 11.12.2008WITHIN THE TIME ALLOWED U/S.139(5) OF THE ACT DECLARING IN COME OF ` 80,14,02,042/- ON WHICH THE TAX PAYABLE AMOUNTING T O ` 11,69,58,702/- RESULTING IN A REFUND OF ` 5,40,99,566/-. THE ASSESSEE RECEIVED A REFUND CHEQUE ON 28.10.2010 AFTER ADJUST ING THE TAX PAYABLE FOR ASSESSMENT YEAR 2000-01 AS PER ASSESSEE S REQUEST. THE AO DENIED INTEREST ON REFUND ON THE GROUND THAT THE INTEREST ARISEN DUE TO PAYMENT OF SELF-ASSESSMENT TAX. AGGRIEVED BY THE ORDER OF LD. ASSESSING OFFICER, THE ASSESSEE CARRIED THE APPEAL BEFORE THE LD.CIT(A). 4. ON APPEAL, LD.CIT(A) OBSERVED THAT THE ASSESSEE IS ENTITLED FOR INTEREST U/S.244A OF THE ACT ON THE REFUND ARISING DUE TO EXCESS TAX PAID UNDER SELF-ASSESSMENT TAX. THE LD.CIT(A) PLA CED RELIANCE ON THE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS.CHO LAMANDALAM INVESTMENT & FINANCE CO. LTD. REPORTED IN [2008] 16 6 TAXMANN 132(MAD.) 5. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. THIS ISSUE CAME UP FOR CONSIDERATION BEFORE THE JURISDICTIONAL ITA NO.1152/MDS./16 :- 3 -: HIGH COURT IN THE CASE OF CIT VS.CHOLAMANDALAM INVE STMENT & FINANCE CO. LTD. ( 294 ITR 438) WHEREIN LORDSHIPS H ELD AS FOLLOWS:- 5. BEFORE PROCEEDING FURTHER, IT IS APT TO REFER SECTION 140A, WHICH PROVIDES FOR PAYMENT OF TAX ON SELF-ASSESSMEN T AND SECTION 244A WHICH PROVIDES FOR THE PAYMENT OF INTE REST ON REFUND. ' 140A. SELF-ASSESSMENT.(1) WHERE ANY TAX IS PAYAB LE ON THE BASIS OF ANY RETURN REQUIRED TO BE FURNISHED UN DER SECTION 115WD OR SECTION 115WH OR SECTION 139 OR SECTION 14 2 OR SECTION 148 OR SECTION 153A OR, AS THE CASE MAY BE, SECTION 158BC, AFTER TAKING INTO ACCOUNT THE AMOUNT OF TAX, IF ANY, ALREADY PAID UNDER ANY PROVISION OF THIS ACT, THE A SSESSEE SHALL BE LIABLE TO PAY SUCH TAX TOGETHER WITH INTER EST PAY ABLE UNDER ANY PROVISION OF THIS ACT FOR ANY DELAY IN FU RNISHING THE RETURN OR ANY DEFAULT OR DELAY IN PAYMENT OF ADVANC E TAX, BEFORE FURNISHING THE RETURN AND THE RETURN SHALL B E ACCOMPANIED BY PROOF OF PAYMENT OF SUCH TAX AND INT EREST. EXPLANATION.WHERE THE AMOUNT PAID BY THE ASSESSEE UNDER THIS SUB-SECTION FALLS SHORT OF THE AGGREGATE OF TH E TAX AND INTEREST AS AFORESAID, THE AMOUNT SO PAID SHALL FIR ST BE ADJUSTED TOWARDS THE INTEREST PAYABLE AS AFORESAID AND THE BALANCE, IF ANY, SHALL BE ADJUSTED TOWARDS THE TAX PAYABLE. (1A) FOR THE PURPOSES OF SUB-SECTION (1), INTEREST PAYABLE, (I) UNDER SECTION 234A SHALL BE COMPUTED ON THE AMO UNT OF THE TAX ON THE TOTAL INCOME AS DECLARED IN THE RETU RN AS REDUCED BY THE ADVANCE TAX, IF ANY, PAID AND ANY TA X DEDUCTED OR COLLECTED AT SOURCE ; ITA NO.1152/MDS./16 :- 4 -: (II) UNDER SECTION 115WK SHALL BE COMPUTED ON THE A MOUNT OF TAX ON THE VALUE OF THE FRINGE BENEFITS AS DECLARED IN THE RETURN AS REDUCED BY THE ADVANCE TAX, PAID, IF ANY. (1B) FOR THE PURPOSES OF SUB-SECTION (1), INTEREST PAYABLE UNDER SECTION 234B SHALL BE COMPUTED ON AN AMOUNT E QUAL TO THE ASSESSED TAX OR, AS THE CASE MAY BE, ON THE AMO UNT BY WHICH THE ADVANCE TAX PAID FALLS SHORT OF THE ASSES SED TAX. PAGE NO : 0441 EXPLANATION.FOR THE PURPOSES OF THIS SUB-SECTION, ' ASSESSED TAX' MEANS THE TAX ON THE TOTAL INCOME AS DECLARED IN THE RETURN AS REDUCED BY THE AMOUNT OF TAX DEDUCTED OR COLLECTED AT SOURCE, IN ACCORDANCE WITH THE PROVISIONS OF CHA PTER XVII, ON ANY INCOME WHICH IS SUBJECT TO SUCH DEDUCTION OR COLLECTION AND WHICH IS TAKEN INTO ACCOUNT IN COMPU TING SUCH TOTAL INCOME. (2) AFTER A REGULAR ASSESSMENT UNDER SECTION 115WE OR SECTION 115WF OR SECTION 143 OR SECTION 144 OR AN ASSESSMENT UNDER SECTION 153A OR SECTION 158BC HAS BEEN MADE, ANY AMOUNT PAID UNDER SUB- SECTION (1) SHALL BE DEEMED TO HAVE BEEN PAID TOWARDS SUCH REGULAR ASSES SMENT OR ASSESSMENT, AS THE CASE MAY BE. (3) IF ANY ASSESSEE FAILS TO PAY THE WHOLE OR ANY P ART OF SUCH TAX OR INTEREST OR BOTH IN ACCORDANCE WITH THE PROV ISIONS OF SUB-SECTION (1), HE SHALL, WITHOUT PREJUDICE TO ANY OTHER CONSEQUENCES WHICH HE MAY INCUR, BE DEEMED TO BE AN ASSESSEE IN DEFAULT IN RESPECT OF THE TAX OR INTERE ST OR BOTH REMAINING UNPAID, AND ALL THE PROVISIONS OF THIS AC T SHALL APPLY ACCORDINGLY.' '244A. INTEREST ON REFUNDS.(1) WHERE REFUND OF ANY AMOUNT BECOMES DUE TO THE ASSESSEE UNDER THIS ACT, HE SHALL, SUBJECT TO THE PROVISIONS OF THIS SECTION, B E ENTITLED TO ITA NO.1152/MDS./16 :- 5 -: RECEIVE, IN ADDITION TO THE SAID AMOUNT, SIMPLE INT EREST THEREON CALCULATED IN THE FOLLOWING MANNER, NAMELY : (A) WHERE THE REFUND IS OUT OF ANY TAX PAID UNDER S ECTION 115WJ OR COLLECTED AT SOURCE UNDER SECTION 206C OR PAID BY WAY OF ADVANCE TAX OR TREATED AS PAID UNDER SECTION 199, DURING THE FINANCIAL YEAR IMME DIATELY PRECEDING TH E ASSESSMENT YEAR, SUCH INTEREST SHALL BE CALCU LATED AT THE RATE OF ONE-HALF PER CENT. FOR EVERY MONTH OR PART OF A MONTH COMPRISED IN THE PERIOD FROM THE 1ST DAY OF APRIL O F THE ASSESSMENT YEAR TO THE DATE ON WHICH THE REFUND IS GRANTED : PROVIDED THAT NO INTEREST SHALL BE PAYABLE IF THE A MOUNT OF REFUND IS LESS THAN TEN PER CENT. OF THE TAX AS DET ERMINED UNDER SUB-SECTION (1) OF SECTION 143 OR ON REGULAR ASSESSMENT ; (B) IN ANY OTHER CASE, SUCH INTEREST SHALL BE CALCU LATED AT THE RATE OF ONE-HALF PER CENT. FOR EVERY MONTH OR PART OF A MONTH COMPRISED IN THE PERIOD OR PERIODS FROM THE DATE OR , AS THE CASE MAY BE, DATES OF PAYMENT OF THE TAX OR PENALTY TO THE DATE ON WHICH THE REFUND IS GRANTED. EXPLANATION.FOR THE PURPOSES OF THIS CLAUSE, ' DAT E OF PAYMENT OF TAX OR PENALTY' MEANS THE DATE ON AND FR OM WHICH THE AMOUNT OF TAX PAGE NO : 0442 OR PENALTY SPECIFIED IN THE NOTICE OF DEMAND ISSUED UNDER SECTION 156 IS PAID IN EXCESS OF SUCH DEMAND. (2) IF THE PROCEEDINGS RESULTING IN THE REFUND ARE DELAYED FOR REA SONS ATTRIBUTABLE TO THE ASSESSEE, WHETHER WHOL LY OR IN PART, THE PERIOD OF THE DELAY SO ATTRIBUTABLE TO HI M SHALL BE EXCLUDED FROM THE PERIOD FOR WHICH INTEREST IS PAYA BLE, AND WHERE ANY QUESTION ARISES AS TO THE PERIOD TO BE EX CLUDED, IT ITA NO.1152/MDS./16 :- 6 -: SHALL BE DECIDED BY THE CHIEF COM MISSIONER OR COMM ISSIONER WHOSE DECISION THEREON SHALL BE FINAL. (3) WHERE, AS A RESULT OF AN ORDER UNDER SUB-SECTIO N (3) OF SECTION 115WE OR SECTION 115WF OR SECTION 115WG OR SUB- SECTION (3) OF SEC TION 143 OR SECTION 144 OR SECTI ON 147 OR SECTION 154 OR SECTION 155 OR SECTION 250 OR SECTIO N 254 OR SECTION 260 OR SECTION 262 OR SECTION 263 OR SECTIO N 264 OR AN ORDER OF THE SETTLEMENT COMMISSION UNDER SUB- SE CTION (4) OF SECTION 245D, THE AMOUNT ON WHICH INTEREST W AS PAY ABLE UNDER SUB-SECTION (1) HAS BEEN INCREASED OR RE DUCED, AS THE CASE MAY BE, THE INTEREST SHALL BE INCREASED OR REDUCED ACCORDINGLY, AND IN A CASE WHERE THE INTEREST IS RE DUCED, THE ASSESSING OFFICER SHALL SERVE ON THE ASSESSEE A NOT ICE OF DEMAND IN THE PRESCRIBED FORM SPECIFYING THE AMOUNT OF THE EXCESS INTEREST PAID AND REQUIRING HIM TO PAY SUCH AMOUNT ; AND SUCH NOTICE OF DEMAND SHALL BE DEEMED TO BE A N OTICE UNDER SECTION 156 AND THE PROVISIONS OF THIS ACT SH ALL APPLY ACCORD INGLY. (4) THE PROVISIONS OF THIS SECTION SHALL APPLY IN R ESPECT OF ASSESS MENTS FOR THE ASSESSMENT YEAR COMMENCING ON THE 1ST DAY OF APRIL, 1989, AND SUBSEQUENT ASSESSMENT Y EARS : PROVIDED THAT IN RESPECT OF ASSESSMENT OF FRINGE BE NEFITS, THE PRO VISIONS OF THIS SUB-SECTION SHALL HAVE EFFECT A S IF FOR THE FIGURES ' 1989', THE FIGURES ' 2006' HAD BEEN SUBST ITUTED.' 6. EVEN THOUGH THE SHORT TITLE TO SECTION 140A READ S AS SELF- ASSESSMENT, THE CHARGING PHRASE EMPLOYED IN SECTION 140A NAMELY ' WHERE ANY TAX IS PAYABLE ON THE BASIS OF A NY RETURN REQUIRED TO BE FURNISHED UNDER SECTION 115WD OR SEC TION 115WH OR SECTION 139 OR SECTION 142 OR SECTION 148 OR SECTION 153A, AS THE CASE MAY BE ; THE ASSESSEE SHA LL BE LIABLE TO PAY SUCH TAX TOGETHER WITH INTEREST PAYAB LE UNDER ITA NO.1152/MDS./16 :- 7 -: ANY PROVISION OF THIS ACT FOR ANY DELAY IN FURNISHI NG THE RETURN', MAKES IT CLEAR THAT THERE IS NO DIFFERENCE BETWEEN : (I) THE TAX PAID UNDER SECTION 115WJ, WHICH DEALS W ITH ADVANCE TAX IN RESPECT OF FRINGE BENEFITS ; OR (II) THE TAX COLLECTED AT SOURCE UNDER SECTION 206C ; OR PAGE NO : 0443 (III) ANY TAX PAID BY WAY OF ADVANCE TAX OR ANY TAX TREATED AS PAID UNDER SECTION 199, WHICH DEALS WITH CREDIT FOR TAX DEDUCTED, WHICH ARE PRO VIDED UNDER SECTION 244A(1) (A). 7. THE PROVISO TO SECTION 244A(1)(A) MAKES IT CLEAR THAT NO INTEREST SHALL BE PAYABLE IF THE AMOUNT OF REFUND I S LESS THAN 10 PER CENT. ON REGULAR ASSESSMENT WITH REGARD TO T HE REFUND OF ADVANCE TAX PAID UNDER SECTION 115WJ IN RESPECT OF FRINGE BENEFITS ; (II) TAX COLLECTED AT SOURCE UNDER SECTI ON 206C ; AND (III) ADVANCE TAX OR ANY TAX TREATED AS PAID UNDER SECTION 199. BUT, WITH RESPECT TO OTHER TAX AS PER SECTION 244A( 1)(B), THE INTEREST SHALL BE PAYABLE EVEN IF THE AMOUNT IS LES S THAN 10 PER CENT. OF THE TAX AS DETERMINED UNDER SECTION 14 3(1) OR ON THE REGULAR ASSESSMENT, BECAUSE THERE IS NO PROVISO TO SECTION 244A(1)(B) AS PROVIDED UNDER SECTION 244A(1 )(A). 8. THAT APART, THE LAW IS WELL-SETTLED THAT EVEN FO R THE REFUND OF TAX PAID UNDER SECTION 140A ON SELF-ASSESSMENT, THE ASSESSEE IS ENTITLED TO INTEREST AS HELD BY THIS CO URT IN CIT V. ASHOK LEYLAND LTD. [2002] 254 ITR 641. 9. IT IS ALSO TRITE LAW THAT WHEREVER THE ASSESSEE IS ENTITLED TO REFUND, THERE IS A STATUTORY LIABILITY ON THE REVEN UE TO PAY THE INTEREST ON SUCH REFUND ON GENERAL PRINCIPLES TO PA Y THE INTEREST ON SUMS WRONGFULLY RETAINED. ITA NO.1152/MDS./16 :- 8 -: 10. WE ARE ALSO STRENGTHENED BY THE DECISION OF THE APEX COURT FOR THE ABOVE VIEW TAKEN IN SANDVIK ASIA LTD. V. CIT [2006] 280 ITR 643, WHEREIN IT IS HELD AS FOLLOWS ( HEADNOTE) : ' IN VIEW OF THE EXPRESS PROVISIONS OF THE INCOME-T AX ACT, 1961, AN ASSESSEE IS ENTITLED TO COMPENSATION BY WA Y OF INTEREST FOR THE DELAY IN THE PAYMENT OF AMOUNTS LA WFULLY DUE TO THE ASSESSEE WHICH ARE WITH HELD WRONGLY AND CON TRARY TO LAW. THE GOVERNMENT IS LIABLE TO PAY INTEREST, AT THE RA TE APPLICABLE TO THE EXCESS AMOUNT REFUNDED TO THE ASS ESSEE, . . .' IN VIEW OF THE ABOVE BINDING DECISION OF THE JURISD ICTIONAL HIGH COURT, WE ARE INCLINED TO DISMISS THE APPEAL OF REVENUE. 6. IN THE RESULT, THE APPEAL OF THE REVENUE IS DIS MISSED. ORDER PRONOUNCED ON 15 TH JULY, 2016, AT CHENNAI. SD/ - SD/ - ( . ) ( G.PAVAN KUMAR ) / JUDICIAL MEMBER ( ) (CHANDRA POOJARI) / ACCOUNTANT MEMBER #$ / CHENNAI %& / DATED: 15 TH JULY, 2016 K S SUNDARAM &'(()*( +* / COPY TO: ( 1 . / APPELLANT 3. ( ,(- . / CIT(A) 5. */0 (1 / DR 2. / RESPONDENT 4. ( , / CIT 6. 02(3 / GF