TVS UPASANA LIMITED,CHENNAI V. ITO, CORPORATE WARD-6(1), CHENNAI

ITA 2475/CHNY/2024

AI Insights

The case involves M/s. TVS Upasana Limited appealing against the order of the Commissioner of Income Tax (Appeals), which denied additional interest on a tax refund. The refund was initially calculated and credited to the assessee's account following an order under section 154 of the Income Tax Act, 1961, but for a shorter period than claimed by the assessee. The Tribunal examined the timeline of events, including the issuance of intimation under section 143(1) and subsequent grievances raised by the assessee regarding the non-receipt of the refund and intimation. The Tribunal referenced a decision by the Delhi High Court, emphasizing that interest on a refund should be calculated until the date the funds are released, not just until the date of the order.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 29448 (ITAT-CHENNAI)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-01-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2020-2021
• Other Referred Cases: Rajasthan State Electricity Board vs. CIT (281 ITR 274), Nokia Solutions and Networks India (P) Ltd. vs. Addl. CIT (169 Taxmann.com 537)
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANDHYA RANI KURE LD.
• Assessee Lawyers: S K. SRINIVASAN; P. VISWANATHAN
• Section: 154; 143(1); 244A

Judgement Text

" आयकर अपीलीय अिधकरण “बी” \u000eा यपीठ चे\u0013ई म\u0016। IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH, CHENNAI मा ननीय \u0019ी जॉज जॉज क े., उपा ! एवं मा ननीय \u0019ी मनोज क ुमा र अ'वा ल ,लेखा सद+ क े सम!। BEFORE HON’BLE SHRI GEORGE GEORGE K., VP AND HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM आयकरअपील सं ./ ITA No.2475/Chny/2024 (िनधा रण वष / Assessment Year: 2020-21) M/s.TVS Upasana Limited 98-A, 7th floor, Auras Corporate Centre, Dr.Radha Krishnan Salai, Mylapore, Chennai-600 004. बना म/ Vs. ITO Corporate Ward-6(1) Chennai. \u0001थायीलेखासं./जीआइआरसं./PAN/TAN No. AAACA-5460-F (अपीलाथ\u001a/Appellant) : ( थ\u001a / Respondent) अपीलाथ\u001aकीओरसे/ Appellant by : S/Shri K. Srinivasan & P. Viswanathan (CAs) – Ld. ARs थ\u001aकीओरसे/Respondent by : Ms. Sandhya Rani Kure (JCIT) -Ld. Sr. DR सुनवाईकीतारीख/Date of Hearing : 08-01-2025 घोषणाकीतारीख /Date of Pronouncement : 09-01-2025 आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member) 1. Aforesaid appeal by assessee for Assessment Year (AY) 2020-21 arises out of an order of learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [CIT(A)] dated 24-07- 2024 in the matter of an intimation issued by CPC u/s 154 of the Act. The sole grievance of the assessee is computation of interest on refund. Having heard rival submissions and upon perusal of case records, the appeal is disposed-off as under. 2 2. The assessee filed return of income on 15-02-2021 wherein it claimed refund of excess tax paid for Rs.40.09 Lacs. Subsequently, the assessee raised two grievances on 11-01-2023 and again on 07-08- 2023 for non-receipt of refund and non-receipt of intimation u/s 143(1). The CPC passed an order u/s 154 on 30-01-2024 wherein refund was determined at Rs.41.03 Lacs along with interest u/s 244A. The refund has been credited to assessee’s account on 31-01-2024. The grievance of the assessee is that the refund has been granted only for 21 months from the period 01-04-2020 to 29-12-2021 as against the claim that the refund was to be granted for 46 months i.e., from April, 2020 to January, 2024. However Ld. CIT(A) denied the same on the ground that refund is granted the moment the concerned officer has signed the order regarding the payment of interest u/s 244A of the act. Reliance was placed on the decision of Hon’ble Rajasthan High Court in the case of Rajasthan State Electricity Board vs. CIT (281 ITR 274) to arrive at such a conclusion. Accordingly, the additional interest was denied to the assessee. Aggrieved, the assessee is in further appeal before us. 3. Upon careful consideration of factual matrix, it could be seen that the additional interest has been denied to the assessee on account of the fact that an intimation appear to have been issued to the assessee u/s 143(1) on 29-12-2021 vide DRN / SRN 2021202037031557992C. However, no refund has been granted to the assessee pursuant to the same. The said intimation is sought to be rectified by CPC and the intimation has accordingly been rectified u/s 154 on 30-01-2024. The reason for the rectification is stated to be ‘suo-moto for refund failure’. It also emerges that the assessee has filed grievance petition on 11-01- 2023 for non-receipt of intimation u/s 143(1) and refund. The same was 3 resolved on 23-05-2023 by stating that intimation would be sent to the email ID once the processing gets completed. Since the same was still not forthcoming, the assessee raised another grievance on 07-08-2023 which was resolved on 10-08-2023 and it was stated that intimation u/s 154 would be sent once the processing gets completed. However, no intimation is shown to have ever been issued to the assessee u/s 143(1). No such intimation has been shown to us also. Finally, an order u/s 154 has been issued on 30-01-2024 wherein the refund has ultimately been granted to the assessee along with interest from 01-04-2020 to 29-12- 2021. The refund amount of Rs.41.03 Lacs has been credited in assessee’s bank account on 31-03-2024 which is quite evident from assessee’ bank statements as placed on record. 4. Upon perusal of all the above stated facts, it could be concluded that though an intimation appear to have been made u/s 143(1), the same was never issued to the assessee and no refund was granted to the assessee pursuant to the same. The refund has ultimately been granted to the assessee only after an order u/s 154 was passed by CPC on 30-01-2024. The Hon’ble High Court of Delhi in the case of Nokia Solutions and Networks India (P) Ltd. vs. Addl. CIT (169 Taxmann.com 537) has held that interest on refund is to be calculated till the date the funds are released to the assessee and not till the date of order accepting the assessee’s claim for grant of refund. The expression ‘refund is granted’ would necessarily mean refund of payment of the amount. The interest is paid to compensate the payee for time value of money. Therefore, it is difficult to accept that the date on which refund is granted as used in Sec. 244A is to be read as the date on which an order accepting the assessee’s claim of grant of refund is passed and 4 not the date on which the funds are released. Applying the same principle, we direct Ld. AO / CPC to grant the interest to the assessee in accordance with law till 30-01-2024. We order so. 5. The appeal stand allowed in terms of our above order. Order pronounced on 9th January, 2025 Sd/- Sd/- (GEORGE GEORGE K.) (MANOJ KUMAR AGGARWAL) उपा ! / VICE PRESIDENT लेखा सद+ / ACCOUNTANT MEMBER चे2ई Chennai; िदनांक Dated :09-01-2025 DS आदेशकीIितिलिपअ'ेिषत/Copy of the Order forwarded to : 1. अपीलाथ\u001a/Appellant 2. थ\u001a/Respondent 3. आयकरआयु;/CIT Chennai. 4. िवभागीय ितिनिध/DR 5. गाड@फाईल/GF "