ACIT, CIRCLE-2(1)(1), MUMBAI, MUMBAI vs. M/S BHARAT PETROLEUM CORPORATION LIMITED, MUMBAI

IN THE INCOME TAX APPELLATE TRIBUNAL (VIRTUAL COURT) “B” BENCH, MUMBAI BEFORE SHRI C.N. PRASAD, HON'BLE JUDICIAL MEMBER AND SHRI M. BALAGANESH, HON'BLE ACCOUNTANT MEMBER

ITA NOs. 5231, 5232 & 5233/MUM/2019 (A.Y.2001-02, A.Y. 2002-03 & A.Y. 2003-04) ACIT – Range 2(1)(1) v. M/s. Bharat Petroleum Corporation Ltd., Bharat Bhavan Room No. 561, 5th Floor 4 & 6 Currimbhoy Road Aayakar Bhavan, M.K. Road Ballard Estate, Mumbai -400001 Mumbai - 400020 PAN:AAACB2902M (Appellant) (Respondent)

ITA NOs. 4892 & 4893/MUM/2019 (A.Y: 2003-04 & A.Y. 2002-03) M/s. Bharat Petroleum Corporation Ltd., v. DCIT – Range 2(1)(1) Bharat Bhavan Aayakar Bhavan, M.K. Road 4 & 6 Currimbhoy Road Mumbai - 400020 Ballard Estate, Mumbai -400001 PAN:AAACB2902M (Appellant) (Respondent)

Assessee by : Shri Ketan Ved Department by Shri Tharian Oommen

Date of Hearing : 17.05.2021 Date of Pronouncement : 30.06.2021

2 ITA NOs. 5231, 5232 & 5233/MUM/2019 ITA NOs. 4892 & 4893/MUM/2019 M/s. Bharat Petroleum Corporation Ltd., O R D E R PER BENCH 1. These appeals are filed by the assessee for the Assessment Years 2002-03 and 2003-04 and by revenue for the Assessment Years 2001-02 to 2003-04 against different orders of the Learned Commissioner of Income Tax (Appeals) -4, Mumbai [hereinafter in short “Ld.CIT(A)”] dated 14.05.2019.

3 ITA NOs. 5231, 5232 & 5233/MUM/2019 ITA NOs. 4892 & 4893/MUM/2019 M/s. Bharat Petroleum Corporation Ltd., Tribunal decision in the case of Union Bank of India v. ACIT in ITA.No. 7589/Mum/2014, directed the Assessing Officer to compute interest u/s.244A as per the findings given by the Hon'ble Delhi High Court observing as under: - “6.1.5. The Appellant placed reliance on the decision of Hon'ble Delhi High Court in case of Re India Trade Promotion organisation v/s CIT (361 ITR 646) wherein the Hon'ble court has held as under: "The words used in section 244A of the Income-tax Act, 1961, are "where refund of any amount becomes due and payable to the assessee under the Act", the assessee shall be entitled to receive in addition to the amount simple interest calculated in the manner stipulated. The Legislature has not used the words "tax paid" or "the principal amount of tax paid", The words used by the Legislature are "any amount" and "said amount". The words, are, therefore, much wider and broader than the tax amount, which is to be refunded. The words "any amount" would include within their scope and ambit the interest element, which has accrued and is payable on the date of the refund. Thus, when the Revenue does not pay the full amount of refund but a part of the amount is paid, it will be liable to pay interest on the balance outstanding amount The balance outstanding amount may consist of the tax paid or the interest, which is payable till the payment of the part amount and interest payable on the principal amount, which remained outstanding thereafter. The decision of the Supreme Court in indicates that it would be incorrect and improper to regard payment of interest when part payment is made as interest on interest. What has been elucidated and clarified by the Supreme Court is that when a refund order is issued, it should include the interest payable on the amount which is refunded. If the refund does not include interest due and payable on the amount refunded, the Revenue would be liable to pay interest on the shortfall. This does not amount to payment of interest on interest The aforesaid manner of the computation is not only applicable to cases where the Revenue has to pay interest on refund, but is equally applicable when an assessee is in default and interest is payable under section 220(2) of the Act Interest payable under section 2348 and section 234C become part of

4 ITA NOs. 5231, 5232 & 5233/MUM/2019 ITA NOs. 4892 & 4893/MUM/2019 M/s. Bharat Petroleum Corporation Ltd., the demand notice issued under section 156 and it is on this amount, i.e., the tax payable plus interest payable under sections 234B and 234C, that interest under section 220(2) is calculated from the date mentioned in the notice of demand till the date of actual payment Under the Explanation to section 140A (1), It is stipulated where the amount paid by an assessee under self-assessment falls short of the aggregate amount of tax and interest aforesaid, the amount paid shall first be adjusted towards the interest payable and the balance, if any, shall be adjusted towards the tax payable. This interpretation follows the same principle, when the Revenue defaults and makes part payment of the amount refundable. The interpretation also ensures that the Assessing Officer/Revenue refunds the entire amount, which is due and payable, including interest payable under section 244A. It discourages part payment. There is no other provision under the Act under which an Assessing Officer Revenue can be made liable to pay interest when part payment is made and the entire amount, which is refundable is not paid to the assessee. Otherwise, the Assessing Officer/Revenue can refund the principal amount and not pay the interest component under section 244A for an unlimited period with impunity and without any sanction, which would amount to allowing a premium on non-compliance with the law." 6.1.6. The appellant further placed reliance in the decision of Hon'ble ITAT Mumbai in case of re Union bank of India v/s ACIT LTU Mumbai in ITA no.7589/Mum/2014 order dated 11/08/2016. 6.1.7. In view of above discussion and respectfully following the judgment of Delhi High Court in the case of Re India Trade Promotion organisation v/s CIT (361 ITR 646) and Hon'ble ITAT Mumbai in case of re Union bank of India v/s ACIT LTU Mumbai in ITA no.7589/Mum/2014, the Assessing Officer is directed to recomputed interest u/s 244A of the Act as per findings given by Hon'ble Delhi, High Court.”

5 ITA NOs. 5231, 5232 & 5233/MUM/2019 ITA NOs. 4892 & 4893/MUM/2019 M/s. Bharat Petroleum Corporation Ltd., 6. Coming to the assessee’s appeals the only common issue is whether assessee is entitled for additional interest as per the provisions of section 244A(1A) of the Act.

6 ITA NOs. 5231, 5232 & 5233/MUM/2019 ITA NOs. 4892 & 4893/MUM/2019 M/s. Bharat Petroleum Corporation Ltd., 9. We have heard the rival submissions, perused the orders of the authorities below and the decisions relied on. The Hon'ble Gujarat High Court in the case of Nima Specific Family Trust v. ACIT (supra) held as under: - “The petitioner is a Trust. For Assessment Year 2004-2005, the petitioner had filed the return of income on 21st October, 2004 declaring total income of Rs. 3,63,92,470/=. The petitioner's tax liability on such returned income came to Rs. 50,77,588/=. The petitioner had claimed refund of Rs. 31,69,265/= which was excess tax paid in advance. … … This brings us to the claims of the petitioner. In this context, learned counsel Shri Soparkar had made two principal claims - one was that additional interest under sub-section [1A] of Section 244A of the Act should be granted. He argued that this provision was inserted by the legislature by way of a remedial measure and should therefore be applied to all pending cases, even those which might have arisen prior to enactment of such section. His second prayer was to grant compensation for long delay in granting refund. He contended that though the Supreme Court in the case of Gujarat Flourochemicals Ltd. v. Commissioner of Income Tax & Ors., reported in [2015] 377 ITR 307 [Guj.] had disapproved the claim of interest-on-interest, had not held that the compensation for delay in giving refund cannot be ordered. In this context, we may refer to the relevant statutory provisions. Section 244A of the Act pertains to "Interest on refunds." Sub-section [1] of Section 244A mandates the Revenue to grant interest at the statutory rate where refund of any amount becomes due to the assessee under the Act. The situations envisaged under subsection [1] of Section 244A are sub-divided into three parts contained in clauses (a), (aa) and (b). Clause (a) of sub-section [1] of Section 244A covers situations where the refund is out of any tax collected at source under section 206C or paid by way of advance tax or treated as paid under section 199 of the Act. Clause (aa) refers to refund which arises out of any tax paid under section 140A of the Act which pertains to selfassessment and clause (b) pertains to claim

7 ITA NOs. 5231, 5232 & 5233/MUM/2019 ITA NOs. 4892 & 4893/MUM/2019 M/s. Bharat Petroleum Corporation Ltd., of refund in any other case. For all the three situations, the period during which such interest would be computed and the rate of interest to be paid are specified. Sub-section [1A] was inserted in Section 244A of the Act by the Finance Act, 2016 w.e.f 1st June 2016 and reads as under: "[1A] Where the whole or any part of the refund referred to in sub-section (1) is due to the assessee, as a result of any amount having been paid by him after the 31st day of March 1975, in pursuance to any order of assessment or penalty and such amount or any part thereof having been found in appeal or other proceeding under this Act to be in excess of the amount which such assessee is liable to pay as tax or penalty, as the case may be, under this Act, the Central Government shall pay to such assessee simple interest at the rate specified in subsection (1) on the amount so found to be in excess from the date on which such amount was paid to the date on which the refund is granted." Simultaneously, the legislature has also amended Section 153 of the Act which pertains to time-limit for completion of assessment, reassessment and re-computation. Entire section 153 was substituted for the original by the Finance Act 2016 w.e.f 1st June 2016. Subsection [5] of Section 153 of the Act reads as under : "[5] Where effect of an order under section 250 or section 254 or section 260 or section 262 or section 263 or section 264 is to be given by the Assessing Officer, wholly or partly, otherwise than by making a fresh assessment or re- assessment, such effect shall be given within a period of three months from the end of the month in which order under section 250 or section 254 or section 260 or section 262 is received by the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner; as the case may be, the order under section 263 or section 264 is passed by the Principal Commissioner or Commissioner : Provided that where it is not possible for the Assessing Officer to give effect to such order within the aforesaid period, for reasons beyond his control, the Principal Commissioner or Commissioner on receipt of such request in writing from the Assessing Officer, if satisfied, may allow an additional period of six months to give effect to the order :

8 ITA NOs. 5231, 5232 & 5233/MUM/2019 ITA NOs. 4892 & 4893/MUM/2019 M/s. Bharat Petroleum Corporation Ltd., Provided further that where an order under section 250 or section 254 or section 254 or section 260 or section 262 or section 263 or section 264 requires verification of any issue by way of submission of any document by the assessee or any other person or where an opportunity of being heard is to be provided to the assessee, the order giving effect to the said order under section 250 or section 254 or section 260 or section 262 of section 263 or section 264 shall be made within the time specified in sub-section (3)." We may note that in the earlier form, Section 153 of the Act did not contain any provision similar or equivalent to sub-section (5) of Section 153 of the Act. Brief analysis of the above provisions would show that prior to the amendments in the Act, by virtue of which Section 244A [1A] and Section 153 [3] were brought into effect from 1st June 2016, the Legislation did not envisage any interest on refund in addition to the interest prescribed under sub-section [1] of Section 244A. Likewise, Section 153 of the Act did not contain any provision prescribing time limit for giving effect to the appellate or revisional orders. With the amendment, subsection [1A] of Section 244A now provides that in case where a refund arises as a result of giving effect to an order under section 250 or section 254 or section 260 or section 262 or section 263 or section 264; wholly or partly, otherwise than by making a fresh assessment or revenue expenditure-assessment, the assessee would be entitled to receive, in addition to the interest payable under sub-section (1), an additional interest on such amount of refund calculated at the rate of three per cent per annum for the period beginning from the date following the date of expiry of the time allowed under sub-section (5) of Section 153 of the Act to the date on which the refund is granted. Provisions of sub-section [1A] can be summarized, thus [i] this sub-section would be applicable : (a) where the refund arises as a result of giving effect to an appellate or revisional order under the sections mentioned therein. (b) is otherwise than by making a fresh assessment or re assessment; [ii] In such circumstances, in addition to interest under sub-section (1), the assessee would receive additional interest at the rate of three per cent per annum.

9 ITA NOs. 5231, 5232 & 5233/MUM/2019 ITA NOs. 4892 & 4893/MUM/2019 M/s. Bharat Petroleum Corporation Ltd., [iii] the period during which such interest would be computed would begin from the date of expiry of the time limit referred to in sub- section (5) of Section 153 of the Act and would end on the date when the refund is granted. Sub-section (5) of Section 153 provides that where the effect to an order of appellate or revisional authority under varioous sections of the Act is to be given by the Assessing Officer, otherwise than by making a fresh assessment or reassessment; wholly or partly, such effect would be given within three months from the end of the month on which such appellate order is received by the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner, or passed by the revisional authority; as the case may be. Proviso to sub-section (5), however, provides that where it is not possible for the Assessing Officer to give effect to such order within such time, for reasons beyond his control, the Principal Commissioner or Commissioner, on receipt of such request in writing from the Assessing Officer, if satisfied, may allow an additional period of six months to give effect to the order. The further proviso to sub-sec. (5) provides that where an appellate or revisional order requires verification of any issue by way of submission of any document by the assessee or any other person, or where an opportunity of being heard is to be provided to the assessee, the order giving effect to such order shall be made within the time specified in sub-sec. (3). Sub-section (3) in turn provides for a time limit for passing fresh assessment pursuant to appellate or revisional order by prescribing time limit of nine months from the end of financial year in which the order under section 254 is received, or order under section 263 or section 264 is passed. Analysis of sub-section (5) of Section 153 would show that the said provision prescribes a time limit of three months for the Assessing Officer to pass an order giving effect to the appellate or revisional order from the end of the month in which appellate order is received or revisional order is passed. Such time limit could be extended by additional period of six months by the Principal Commissioner or Commissioner, if he is satisfied that it was not possible for the Assessing Officer to give effect to such order within time prescribed, for reasons beyond his control. Cases where appellate or revisional order requires verification of any issue by way of submission or documents, or where opportunity of being heard is to be given to the assessee, would be governed separately. The time limit prescribed therein would be same as in subsection (3) of Section 153.

10 ITA NOs. 5231, 5232 & 5233/MUM/2019 ITA NOs. 4892 & 4893/MUM/2019 M/s. Bharat Petroleum Corporation Ltd., In absence of the provisions contained in sub-section (5) of Section 153, the Assessing Officer was under no obligation to pass order giving effect to the appellate or revisional orders within a particular time. Subsection (5) now lays down such time limit. Likewise, in absence of provisions contained in sub-section (1A) of Section 244A, there was no further adverse effect on the revenue for not passing consequential orders giving effect to appellate or revisional order which may be in favour of the assessee; except for paying interest as prescribed under sub-section (1) of Section 244A. These provisions, therefore, on one hand lay down time limits for giving effect to the appellate or revisional orders and on the other hand, provide for payment of additional interest at the rate of three per cent per annum from the end of the period for passing order giving effect to such appellate or revisional orders. For obvious reasons, the inability of the Assessing Officer to pass orders giving effect to the appellate or revisional orders which had given relief to the assessee within the time prescribed under sub sec. (5) of Section 153, would not make the proceedings non-est. It is the assessee who stands to gain out of the appellate or revisonal order, and therefore, would be eager to have the Assessing Officer give effect to such order. The Assessing Officer, if for some reason cannot pass order within prescribed time, must still do so but, this would trigger the liability of the revenue to pay additional interest; as provided under sub-sec. [1A] of Section 244A. This somewhat detailed analysis of the statutory provisions was necessary in order to ascertain whether the provisions are meant to be applied prospectively or retrospectively. It is well settled that a statutory amendment making substantive changes would have prospective effect unless either expressly or by necessary implications, the legislature has provided for retrospective operation thereof. In his book "Principles of Statutory Interpretation", Justice GP Singh refers to observations of Frankfurter in his article "Some reflections on the Reading of Statutes", wherein, it is observed that, "Legislation has an aim, it seeks to obviate some mischief, to supply and indequacy, to effect a change of policy, to formulate a plan of government. That aim, that policy is not drawn, like nitrogen, out of the air, it is evidenced in the language of the statute, as read in the light of other external manifestations of purpose." Though it is well settled that statutes dealing with substantive rights are prima facie prospective, unless it is expressly or by necessary implication made to have retrospective operation, such rigors are not recognized by the Courts when it comes to dealing with remedial statutes. Nevertheless, whether remedial statute is meant to apply to past situations arising before introduction of the provisions in the

11 ITA NOs. 5231, 5232 & 5233/MUM/2019 ITA NOs. 4892 & 4893/MUM/2019 M/s. Bharat Petroleum Corporation Ltd., statute book must depend on the language used in the statute and the purpose for which the amendment was being made by the legislature. We have noticed that prior to the relevant amendments made in the Act and introduced w.e.f 1st June 2016, there was neither a limit prescription for passing orders giving effect to appellate or revisional orders in which relief - partially or fully may have been given to the assessee nor was there any adverse impact on the revenue if such action was delayed; except for paying statutory interest under sub- sec. [1] of Section 244A of the Act. Sub-section [5] of Section 153 introduced time limits for passing such orders. Such time limits were also prescribed in graded manner. Ordinarily, the Assessing Officer would have three months to pass orders giving effect to appellate or revisional orders. If the Commissioner was satisfied that it was not possible for the Assessing Officer to do so within such time, he could extend the time by further six months but no more. In cases where the order required verification of any issue by way of submission of document by the assessee or any other person, or where an opportunity of being heard is to be provided to an assessee, the time limit from the outset would be longer. This laying down of the time limit per se would be of no consequence unless non adherence to the time would result into some adverse consequences to the Revenue. It is therefore that sub-section [1A] of Section 244A provides for additional interest at the rate of three per cent per annum upon the Assessing Officer failing to pass an order giving effect to the appellate or revisional order withing the time frame. These provisions thus are in the nature of deterrence to the Assessing Officer's inaction. Simultaneously, the assessee would be compensated for delay by way of additional interest. These provisions are thus remedial in nature and meant to address the issue of inordinate delay in giving effect to the appellate or revisional orders made in favour of the assesses. However, minute examination of these provisions would show that the same were not meant to have retrospective effect. The computation provision for granting such interest provides for two terminal points - the beginning point is the end of the period beginning from the date following the date of expiry of time allowed under section (5) of Section 153 and the end point of computing the interest would be the date on which refund is granted. Applying such provisions for the past period would immediately throw a question as to from which date such interest liability would arise. For the past period, there being no provision in sub-section (5) of Section 153 laying time limits, the computation of beginning of the period for granting

12 ITA NOs. 5231, 5232 & 5233/MUM/2019 ITA NOs. 4892 & 4893/MUM/2019 M/s. Bharat Petroleum Corporation Ltd., interest would be unworkable. Claim of interest for the past period cannot be accepted for want of any machinery provided by the legislature to calculate such interest. The legislature therefore by necessary implications did not desire to give any retrospective effect to these provisions. The claim for additional interest therefore cannot be granted for the periods when the provisions of Section 244A [1A] and 153 [3] as they stand now were not in statute book at all. There would however be a caveat to this proposition and it is this. There may be cases where the appellate or revisional order may have been passed long before 1st June 2016. Till the relevant provisions of Section 244 [1A] and 153 [5] were added by the legislature on 1st June 2016, the Assessing Officer may not have passed the consequential order. Even after such amendments, he may not have passed the order within the time provided in such amendments. Even in such a case, if the amended provision of sub-section [1A] of Section 244 of the Act is not applied for the period past 1st June 2016, the same would give rise to two class of cases – [i] where the appellate or revisional order is passed after 1st June 2016 and the other where such order is passed before such date. In the former, all the provisions of sub-section [1A] of Section 244A as well as sub- section (5) of Section 153 of the Act would apply. In the latter, if harmonious construction approach is not adopted, the Assessing Officer could contend that he is under no obligation to pass order giving effect to the appellate or revisional order, nor would the revenue be liable to pay additional interest even after the time available to the Assessing Officer for passing such order has expired. The legislature could not be expected to have brought about such a situation. Any such interpretation would also restrict the prospective effect of these provisions. In such circumstances, the harmonious construction of the statutory provisions would require that if any order giving effect to the appellate or the revisional order is not passed by the Assessing Officer within the time permitted under section 153 [5], after the amendments were made in the statute book, even though the appellate or revisional order was passed before 1st June 2016, the liability to pay additional interest under subsection [1A] of Section 244A would arise upon completion of such period as if the starting point for computing such period for passing the order was 1st June 2016. To this limited extent, the petitioner would be entitled to additional interest for limited period, but not for the entire period starting from the original order of Commissioner dated 5th March 2009. Learned counsel Shri Soparkar had, however, argued that the compensation for delayed payment of refund should be granted. This

13 ITA NOs. 5231, 5232 & 5233/MUM/2019 ITA NOs. 4892 & 4893/MUM/2019 M/s. Bharat Petroleum Corporation Ltd., contention and claim was independent of the claim for interest on interest which he agreed would not be payable by virtue of the judgment of the Supreme Court in the case of Gujarat Flourochemicals Limited [Supra] and also independent of the additional interest under subsection [1] of Section 244A. This judgment has a short history, which we may record. As is well known, the Supreme Court in the case of Sandvik Asia Limited v. Commissioner of Income tax & Ors., reported in [2006] 280 ITR 643 [SC] had an occasion to consider a situation in which the advance tax paid by the assessee became refundable pursuant to an appellate decision. The principal was refunded but refund of interest was withheld for a long time. The Supreme Court posed a question to itself whether on general principles, the assessee ought to have been compensated for the inordinate delay for receiving monies properly due to it. It was noticed that the revenue has retained such monies of the assessee for the periods ranging from 12 to 17 years. The Court held that the revenue having unjustifiably withheld the refund for seventeen years without any reason, the assessee would be entitled to receive such amount with further interest. The larger Bench of the Supreme Court considered the question whether the decision in case of Sandik Asia Limited v. CIT [Supra] lays down the principle that interest on interest is payable when the refund is delayed. The Supreme Court explained the decision in case of Sandvik Asia Limited [Supra] observing that the Supreme Court in such case was considering the issue as to whether the assessee who was made to wait for refund of interest for decades should be compensated for great prejudice caused to it due to delay in its payment after the lapse of statutory period. It was in this background, the Court directed the Revenue to pay compensation which cannot be seen as a direction for payment of interest on interest. The Supreme Court held and observed as under : "6. In our considered view, the aforesaid judgment has been misquoted and misinterpreted by the assesses and also by the Revenue. They are of the view that in Sandvik case [Supra] this Court had directed the Revenue to pay interest on the statutory interest in case of delay in the payment. In other words, the interpretation placed is that the Revenue is obliged to pay an interest on interest in the event of its failure to refund the interest payable within the statutory period. 7. As we have already noted, in Sandvik case [Supra] this Court was considering the issue whether an assessee who is made to wait for refund of interest for decades be compensated for the great prejudice cause to it due to the delay in its payment after the lapse of statutory period. In the

14 ITA NOs. 5231, 5232 & 5233/MUM/2019 ITA NOs. 4892 & 4893/MUM/2019 M/s. Bharat Petroleum Corporation Ltd., facts of that case, this Court had come to the conclusion that there was an inordinate delay on the part of the Revenue in refunding certain amount which included the statutory interest and therefore, directed the Revenue to pay compensation for the same not an interest on interest." For subsequent year also, in the case of the same assessee Gujarat Flourochemicals Limited, a similar issue came up before the Supreme Court. Upon an appeal against the judgment passed by the High Court, the Supreme Court remanded the proceedings before the Court after making reference to its earlier judgment in the case of Gujarat Flourochemicals Limited [Supra]. It was in this background that the Gujarat High Court in the case of Gujarat Flourochemicals Limited v. Commissioner of Income tax, [2015] 377 ITR 307 [Guj.] was examining the issue of payment of interest for delayed refund made by the Revenue. The Court noticed observations of the Apex Court that the interest on the amount of refund, if provided by the statute, such would govern the field. The Court was of the opinion that in case of Gujarat Flourochemicals Limited [Supra], the Supreme Court did not shut out the question of directing the Government to pay compensation for non payment of statutory interest. In this background, the Court gave suitable directions for payment of compensation. The situation therefore emerges is that as held by the Supreme Court in the case of Gujarat Flourochemicals Limited [Supra], whenever statute provides for interest on delayed refunds, the same would hold the field. Further, there cannot be any direction for payment of interest on interest. In the present case, the statute provides for interest on delayed refund in terms of sub-section [1] of Section 244A of the Act. As and when applicable, newly inserted sub-section [1A] of Section 244A provides for additional interest. The statutory provisions thus govern the situations where the interest on delayed refund would be paid as also the rate on which such interest is to be calculated. There cannot be any further direction for payment of interest over and above such statutory prescriptions. This is not a case where the principal refund is granted at one point of time, withholding the interest and the Revenue thereafter, having frozen the liability of interest seeks to avoid making any further payment of compensation on the amount of interest which remained unpaid for a long period of time. Under the circumstances, the petition is disposed of with the following observations and directions:

15 ITA NOs. 5231, 5232 & 5233/MUM/2019 ITA NOs. 4892 & 4893/MUM/2019 M/s. Bharat Petroleum Corporation Ltd., [i] The petitioner would not be entitled to additional interest under sub-section [1A] of Section 244A of the Act during the entire period after passing of the appellate order, but would be entitled to such additional interest after introduction of the relevant statutory provisions w.e.f 1st June 2016 in terms of the observations made in this judgment. [ii] The petitioner cannot claim any further interest or compensation over and above the statutory interest prescribed. However, looking to long delay which has clearly remained explained in giving effect to the appellate order, the respondent shall pay cost of Rs. 1,00,000/= [rupees one lakh] to the petitioner. [iii] It is expected that the concerned Assessing Officers would pass necessary orders giving effect to the appellate or revisional orders in case of petitioner and other group entities as expeditiously as possible. We expect that the Revenue would not drive the petitioner to unnecessary litigation in this respect.”

16 ITA NOs. 5231, 5232 & 5233/MUM/2019 ITA NOs. 4892 & 4893/MUM/2019 M/s. Bharat Petroleum Corporation Ltd., passed the order within the time provided in such amendments. Even in such a case, if the amended provision of sub-section [1A] of Section 244 of the Act is not applied for the period past 1st June 2016, the same would give rise to two class of cases – [i] where the appellate or revisional order is passed after 1st June 2016 and the other where such order is passed before such date. In the former, all the provisions of sub-section [1A] of Section 244A as well as sub- section (5) of Section 153 of the Act would apply. In the latter, if harmonious construction approach is not adopted, the Assessing Officer could contend that he is under no obligation to pass order giving effect to the appellate or revisional order, nor would the revenue be liable to pay additional interest even after the time available to the Assessing Officer for passing such order has expired. The legislature could not be expected to have brought about such a situation. Any such interpretation would also restrict the prospective effect of these provisions. In such circumstances, the harmonious construction of the statutory provisions would require that if any order giving effect to the appellate or the revisional order is not passed by the Assessing Officer within the time permitted under section 153 [5], after the amendments were made in the statute book, even though the appellate or revisional order was passed before 1st June 2016, the liability to pay additional interest under sub-section [1A] of Section 244A would arise upon completion of such period as if the starting point for computing such period for passing the order was 1st June 2016. To this limited extent, the petitioner would be entitled to additional interest for limited period, but not for the entire period starting from the original order of Commissioner dated 5th March 2009.”

17 ITA NOs. 5231, 5232 & 5233/MUM/2019 ITA NOs. 4892 & 4893/MUM/2019 M/s. Bharat Petroleum Corporation Ltd., for examining the facts of the assessee in the present appeals and for application of the ratio of decision in view of the observations of their lordships on applicability of the additional interest to the present appeals. Thus, we restore this issue to the file Assessing Officer who shall examine the issue afresh in the light of the decision of the Hon'ble Gujarat High Court (supra).

Order pronounced on 30.06.2021 as per Rule 34(4) of ITAT Rules by placing the pronouncement list in the notice board. Sd/- Sd/- (M. BALAGANESH) (C.N. PRASAD) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai / Dated 30.06.2021 Giridhar, Sr.PS Copy of the Order forwarded to: 1. The Assessee 2. The Respondent. 3. The CIT(A), Mumbai. 4. CIT 5. DR, ITAT, Mumbai 6. Guard file. //True Copy// BY ORDER

(Asstt. Registrar) ITAT, Mum