TOLANI EDUCATION FOUNDATION, MUMBAI V. ACIT CENTRAL CIRCLE 17 & 28, MUMBAI

ITA 6508/MUM/2013

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 3055 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 11 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-10-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: E
• Assessment Year: 2002-2003
• Appeal Filed On: 06-11-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S M AGRAWAL
• Section: 244A

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL E BE NCH, MUMBAI BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND SHRI SANJAY GARG, JUDICIAL MEMBER / I .T.A. NOS.6508, 6509 & 6510/MUM/2013 ( / ASSESSMENT YEARS:2002-03, 2003-04 & 2006-07 TOLANI EDUCATION FOUNDATION, 10A, BAKHTAWAR, NARIMAN POINT, MUMBAIA-400 021 / VS. THE ACIT, CENTRAL CIRCLE 17 & 28, MUMBAI ./ ./ PAN/GIR NO. : AAATT 0396G ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY: SHRI S.M. AGRAWAL / RESPONDENT BY: MS. SURABHI SHARMA / DATE OF HEARING : 05.10.2015 ! / DATE OF PRONOUNCEMENT :16.10.2015 '# / O R D E R PER N.K. BILLAIYA, AM: THESE THREE APPEAL BY THE ASSESSEE ARE DIRECTED AG AINST THREE SEPARATE ORDERS OF THE LD. CIT(A)-1, MUMBAI PERTAI NING TO ASSESSMENT YEARS 2002-03, 2003-04 AND 2006-07. I N ALL THESE APPEALS, THE GRIEVANCE OF THE ASSESSEE IS SAME AND WHICH IS DENIAL OF INTEREST ON REFUND UPTO THE DATE OF ISSUING THE R EFUND VOUCHER AS PER THE PROVISIONS OF THE LAW. 2. THE GRIEVANCE OF THE ASSESSEE RELATES TO THE ORD ER GIVING EFFECT TO THE APPELLATE ORDER BECAUSE OF WHICH THE ASSESSE E WAS ENTITLED FOR ITA. NOS.6508 TO 6510/M/2013 2 REFUND THOUGH THE REFUND WAS GRANTED BUT ACCORDING TO THE ASSESSEE PROPER INTEREST AS PER THE PROVISIONS OF THE LAW H AVE NOT BEEN GIVEN TO THE ASSESSEE UPTO THE DATE OF ISSUING THE REFUND VOUCHER. 3. THE CLAIM OF THE ASSESSEE WAS DENIED BY THE LD. CIT(A) FOR A.Y. 2002-03 HOLDING AS UNDER: I HAVE CAREFULLY CONSIDERED THE FACTS OF THE CASE A ND SUBMISSIONS OF THE APPELLANT WHICH ARE PRIMARILY IN THE NATURE OF CLAIM OF INTEREST TO THE DATE OF DELIVERY OF REFUND CHEQUE IN THE HANDS OF APPELLANT. THE SUBMISSIONS AND CLAIM MADE BY THE APPELLANT ARE BASELESS, VAGUE AND GENERAL IN NATURE WITHOUT ANY SUPPORTING LAW AND RULES IN THIS BEHALF. I WOULD FU RTHER OBSERVE THAT THE INTEREST PAYABLE TO ASSESSEE U/S 244A AND ITS CALCULATION IS ALSO PROVIDED UNDER RULE- 119A R.W.S. 244A WHERE THE WORD APPEARING IS 'REFUND GRANTED' WHICH CLEARLY MEANS T HE DETERMINATION OF THE QUANTUMS AND INTEREST THROUGH THE RELEVANT ORDER IN THIS BEHALF, THEREBY MAKING THE DATE OF SU CH ORDER THE CUT-OFF POINT FOR THIS PURPOSE. HOWEVER, IT CAN ALSO BE SEEN THAT THE GROUNDS OF AP PEAL RAISED BY THE APPELLANT ARE NOT COVERED UNDER THE P ROVISIONS OF SECTION 246A WHICH COULD BE SUBJECT MATTER OF APPEA L BEFORE ME. LOOKING AT THE NATURE OF GROUNDS OF APPEAL IT CAN B E SEEN THAT SAME ARE BEYOND THE PURVIEW OF LAW AND RULES UNDER THE INCOME TAX IN THIS BEHALF AND CAN BE BROUGHT TO THE NOTICE OF HIGHER AUTHORITIES AS GRIEVANCE OF ADMINISTRATIVE NATURE. IN VIEW OF THE ABOVE DISCUSSIONS AND FOR THE REASONS THEREIN, GROU NDS OF APPEAL NO. 1, 2 AND 3 ARE DISMISSED. 4. WE HAVE CAREFULLY GONE THROUGH THE FINDINGS OF T HE LD. CIT(A) AND WE DO NOT AGREE WITH THE SAME. IT IS A SETTLED PROPOSITION OF LAW THAT INTEREST ON REFUND HAS TO BE GRANTED UPTO THE DATE OF ISSUE OF THE REFUND VOUCHER. THE TRIBUNAL MUMBAI BENCH HAD THE OCCASION TO CONSIDER A SIMILAR SITUATION IN THE CASE OF JAY BR OS INVESTMENT AND TRADING CO. (P) LTD VS DCIT 74 TTJ 748 WHEREIN THE TRIBUNAL HAS HELD AS UNDER: ITA. NOS.6508 TO 6510/M/2013 3 WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE RECORD. IN OUR VIEW, THE PLEA OF THE AS SESSEE DESERVES FAVOURABLE CONSIDERATION. IN SEVERAL CASES , WHERE A REFUND HAS TO BE GRANTED TO THE ASSESSEE, THE REVEN UE OFFICIALS USED TO TAKE LONGER TIME IN CLEARING SUCH REFUNDS RESULTING IN CONSIDERABLE HARDSHIP TO THE ASSESSEE AND WITH A VIEW TO EXPEDITE GRANT OF REFUND, A UNIFORM PERIOD OF THREE MONTHS HAS BEEN SPECIFIED IN SS. 243 AND 244 BY TAX ATION LAWS (AMENDMENT) ACT, 1970. IF THERE IS DELAY BEYON D THE PERIOD OF THREE MONTHS, IT ACT PROVIDED FOR PAYMENT OF INTEREST TO THE ASSESSEE BY THE CENTRAL GOVERNMENT. WHILE IMPLEMENTING THE PROVISIONS OF S. 243 OF THE ACT, I T WAS AGAIN FOUND THAT THE AO GAVE A DIFFERENT INTERPRETATION O F THE SAID SECTION WHICH IS NOT INTENDED BY THE GOVERNMENT. WI TH A VIEW TO CLARIFY THE ISSUE, THE CBDT ISSUED A CIRCULAR (E XTRACTED ABOVE). IT MAY ALSO BE NOTED THAT S. 243 IS OPERATI VE UPTO ASST. YR. 1988-89 ONLY WHEREAS S. 244A COMES INTO E FFECT FROM 1ST APRIL, 1989 IN LIEU OF SS. 214, 243 AND 24 4 AS CLARIFIED BY THE CBDT IN ITS CIRCULAR NO. 549 DT. 3 1ST OCT., 1989, [PUBLISHED AT (1990) 82 CTR (ST) 1]. THEREFOR E, IT IS CLEAR THAT THE CIRCULAR ISSUED IN CONNECTION WITH S . 243 OF THE IT ACT EQUALLY APPLIES TO S. 244A. IT ALSO APPEALS TO LOGIC THAT INTEREST HAS TO BE PAID TILL THE DATE OF PREPARATIO N OF CHEQUE AS OTHERWISE THE PURPOSE OF GRANTING INTEREST WOULD BE DEFEATED BECAUSE IN THE GOVERNMENT DEPARTMENTS THER E MAY BE LONG GAP BETWEEN THE FORMAL ORDER AND THE DATE O F PREPARATION OF CHEQUES. THE CBDT CATEGORICALLY STAT ED THAT INTEREST HAS TO BE GRANTED UPTO THE DATE OF REFUND VOUCHER. IN FACT, THE CHEQUE ISSUED BY THE GOVERNMENT IS KNOWN AS 'INCOME TAX REFUND ORDER'. THEREFORE, IT IS PROPER TO ASSUME THAT THE WORDS 'ON WHICH THE REFUND IS GRANTED' IN S. 244A MEAN THE DATE OF SIGNING THE INCOME-TAX REFUND ORDE R I.E., THE REFUND VOUCHER. WE, THEREFORE, DIRECT THE AO TO CALCULATE INTEREST PAYABLE TO THE ASSESSEE FROM FIRST DAY OF APRIL OF THE ASSESSMENT YEAR TO THE DATE ON WHICH THE REFUND VOU CHER IS SIGNED. CONSIDERING THE CIRCUMSTANCES OF THE CASE, WE ARE ALSO OF THE VIEW THAT IT IS A FIT CASE FOR AWARDING COSTS TO THE ASSESSEE UNDER S. 255(2B) OF THE ACT. IN OUR VIEW, AWARDING COST OF RS. 3,000 WOULD MEET THE ENDS OF JUSTICE AN D WE HEREBY DIRECT THE RESPONDENT TO DEPOSIT THE COST WI TH THE DY. REGISTRAR, TRIBUNAL (MUMBAI ZONE) WITHIN ONE MONTH FROM THE DATE OF RECEIPT OF THE ORDER AND THE REGISTRY IS FU RTHER DIRECTED TO COLLECT THE COST AND PAY THE SAME TO TH E ASSESSEE UPON PRESENTING AN APPLICATION TO THAT EFFECT. ITA. NOS.6508 TO 6510/M/2013 4 RESPECTFULLY FOLLOWING THE FINDINGS OF THE CO-ORDIN ATE BENCH, WE DIRECT THE AO TO CALCULATE INTEREST AS PER THE P ROVISIONS OF THE LAW UPTO THE DATE ON WHICH THE REFUND VOUCHER IS SIGNED . 5. AS MENTIONED ELSEWHERE, THE FACTS OF ALL THE IMP UGNED ASSESSMENT YEARS ARE SAME, THEREFORE ALL THE APPEAL S ARE ALLOWED ACCORDINGLY. 6. IN THE RESULT, ALL THE APPEALS FILED BY THE ASSE SSEE ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 16 TH OCTOBER, 2015 SD/- SD/- (SANJAY GARG ) (N.K. BILLAIYA) $% ' /JUDICIAL MEMBER ' / ACCOUNTANT MEMBER & ' MUMBAI; (' DATED : 16 TH OCTOBER, 2015 . % . ./ RJ , SR. PS !' #' / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ) ( ) / THE CIT(A)- 4. ) / CIT 5. *+, %%-. , -.! , & ' / DR, ITAT, MUMBAI 6. ,/0 1 / GUARD FILE. $ / BY ORDER, * % //TRUE COPY// % / $& ' (DY./ASSTT. REGISTRAR) , & ' / ITAT, MUMBAI