BENGAL DCL HOUSING DEVELOPMENT CO. LTD.,KOLKATA vs. THE DCIT, CIR-8, KOLKATA, KOLKATA

The grievances raised by the assessee are as follows:

The brief facts qua the issue are that the ld. CIT(A) directed the Assessing Officer, vide order dated 27.11.2009 in appeal No.520/CIT(A)-VIII/8(4)/08-09, to revise the total income of the assessee. Accordingly, the Assessing Officer computed revised income of the assessee taking into account the order u/s 143(3) of the Act. While making the revised computation of the assessee, the Assessing Officer did not consider the self assessment tax paid u/s 140A of the Act properly and charged interest u/s 234D and U/s 220(2) of the Act. During the relevant assessment Year, the assessee company had paid tax aggregating to Rs. 76,91,566/- ( consisting Rs.57,59,000/- self assessment tax plus Rs.19,32,566/- credit for TDS). While issuing the order giving effect to the above mentioned order of the ld CIT(A), interest U/s 244A was allowed by the Assessing Officer only to the extent of the TDS credited claimed by the assessee. The interest on refund arising on account of the excess payment of self-assessment tax by the assessee was ignored while computing the interest u/s 244A of the Act.

The main grievance of the assessee is that the assessee had paid his self- assessment tax u/s 140A of the Act to the tune of Rs.57,59,000/- whereas the total payable worked out by the Assessing Officer after considering the interest u/s 234B, 234C was to the tune of Rs.52,97,372/-. Therefore, assessee was entitled to refund to the tune of Rs.4,61,628/- (Rs.57,59,000 - 52,97,372). However, the Assessing Officer issued a refund to the assessee on 16.11.07 to the tune of Rs.5,50,760/- and worked out amount payable by the assessee to the tune of Rs.89,132/-. Thereafter, the Assessing Officer charged the interest u/s 234D to the tune of Rs.6,237/- and interest u/s 220(2) to the tune of Rs.10,483/- and worked out the net payable by assessee to the tune of Rs.1,05,852/- ( Rs. 89,132 + Rs.6,237 + Rs.10,483).

Aggrieved by the order of the ld. CIT(A), the assessee is in appeal before us. The ld. Counsel for the assessee submitted before us that the Assessing Officer ought to have allowed interest u/s 244A of the Act on the amount of refund arising on account of excess payment of self-assessment tax by the assessee. The ld. Counsel for the assessee also pointed out that Clause (b) of sub-Section 1 of Section 244A is a residuary in nature which provides for interest on refund in other cases including excess tax paid on self-assessment u/s 140A of the Act.

On the other hand, the ld. DR for the Revenue has primarily reiterated the stand taken by the Assessing Officer which we discussed in our earlier para and is not being repeated for the sake of convenience and brevity.

We have given a careful consideration to the rival submissions and perused the materials available on record, we note that during the assessment year under consideration, the assessee company had paid self-assessment tax u/s 140A of the Act amounting to Rs.57,59,000/- and credited for tax debited at source aggregating to Rs.19,32,566/-. This way, the assessee company had paid tax to the tune of Rs.76,91,566/-. We note that assessee is entitled to have interest on excess self-assessment paid by him as the assessee had paid the excess amount hence the assessee would be entitled to interest u/s 244A of the Act, on the refund of self-assessment tax. We note that the Hon’ble Supreme Court in the case of CIT vs. Engineers India Ltd. [2015] 55 taxmann.com, held that assessee would be entitled to interest u/s 244A of the Act ‘ on refund of self-assessment tax’. We also rely on the judgment of the Hon’ble Calcutta High Court in the case of CIT vs. Birla Corporation Ltd. wherein it was held that interest on refund of excess payment on self assessment tax should be allowed to the assessee.

In the result, the appeal filed by the assessee is allowed.