N PALANIAPPAN,TRICHY vs. ACIT, COMPANY CIRCLE-II, MADURAI

आदेश / O R D E R

PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER:

Ld. Counsel for the assessee submitted that assessee was 2. an ex-employee of ICICI Bank. As per the ld. Authorised Representative, assessee was not given exemption of �5,00,000/- u/s.10(10C) of the Act. The said relief as per the ld. Authorised Representative was given on an appeal filed by the assessee.

Contention of the ld. Authorised Representative was that in the meanwhile assessee had filed a rectification petition which was rejected by the ld. Assessing Officer. As per the ld. Authorised Representative ld. Assessing Officer, on 22.05.2012, gave effect to the order of the ld. Commissioner of Income Tax (Appeals) calculating the revised total income of the assessee at �15,50,070/- and granted a refund of �1,63,905/-. However interest u/s.244A of the Act was not given to the assessee. Ld. Authorised Representative submitted that assessee had requested for such interest through a petition, when it received the giving effect order dated 22.05.2012 of the ld. Assessing Officer. As per the ld. Authorised Representative, ld. Assessing Officer rejected the said petition, taking a view that refund arose due to relief granted on an Appellate order and the delay was attributable to the assessee and not the Department. On assessee’s appeal, as per the ld. Authorised Representative, the ld. Commissioner of Income Tax (Appeals) observed that assessee had filed its earlier appeal against non grant of relief u/s.10(10C) of the Act belatedly. As per the ld. Authorised Representative, though the ld. Commissioner of Income Tax (Appeals) had earlier condoned the delay of five years and six months, he held such delay as attributable to the assessee. He thus, confirmed the order of the ld. Assessing Officer.

Now before us, the ld. Authorised Representative strongly 3. assailing the orders of the lower authorities submitted that the delay in filing the original appeal having been condoned by the ld. Commissioner of Income Tax (Appeals), there was no reason why assessee could not be granted interest u/s.244A of the Act.

We have considered the rival contentions and perused the 5. orders of the authorities below. Section 244A(2) of the Act which is apposite here is reproduced hereunder:-

(2) If the proceedings resulting in the refund are delayed for reasons attributable to the assessee, such period should be excluded from the period for which interest is payable and where any question arises as to the period to be excluded, it shall be decided by the Chief Commissioner or Principal

Commissioner or Commissioner whose decision thereon shall be final’’.

Assessee was denied interest u/s.244A of the Act for a reason that appeal filed by it against denial of exemption u/s.10(10C) of the Act was with a delay of five years and six months. However, appeal filed by the assessee was allowed by the concerned ld. Commissioner of Income Tax (Appeals) after condoning such delay. Not only the delay was condoned, but also relief sought by the assessee was given.

Refund became due to the assessee on account of such relief. When an assessee is eligible for an exemption given to it under the Act, it is the duty of the lower authorities to give such exemption at the first stage of proceedings. Assessee was compelled to move an appeal to get the exemption available to it u/s.10(10C) of the Act, due to denial of such relief by the ld. Assessing Officer. Assessee being an individual might have believed that exemption u/s.10(10C) of the Act was not available to him and chosen not to move an appeal in the initial stage.

However, it is an admitted position that assessee did file the appeal with and such delay was condoned by the ld. Commissioner of Income Tax (Appeals). In such circumstances, we cannot say that the proceedings resulting in the refund were delayed to any reason attributable to the assessee. Especially so, since the question whether exemption u/s.10(10C) of the Act could be given to an employee retiring from a private sector bank, was in a fluid stage and not free from doubt. Issue was ruled in favour of the assessee much later. Thus in our opinion proceedings resulting refund was not delayed due to any reason attributable to the assessee. We therefore hold that assessee is entitled for interest u/s.244A of the Act. Orders of the lower authorities are set aside. Ld. Assessing Officer is directed to grant the assessee interest u/s.244A of the Act on the refund granted to it.

In the result, the appeal of the assessee stands allowed. 6.

Order pronounced in the open court at the time of hearing on 10th July, 2018, at Chennai.