“interest on refund”

InterestSection 244ASection 244A278 judgments

The decision most relied on for interest on refund is Sandvik Asia Ltd. v. CIT (280 ITR 643), cited in 96 judgments on BharatTax.

Leading authorities on interest on refund

Sandvik Asia Ltd. v. CIT

280 ITR 643 · 2006 · Supreme Court

citing judgments

Assessees are entitled to compensation for the inordinate delay by the Income Tax Department in refunding excess tax, which includes interest on the statutory interest due under section 244A for such delayed refunds.

Union of India v. Tata Chemicals Ltd.

363 ITR 658 · 2014 · Supreme Court

citing judgments

The Department has a moral and legal obligation to refund excess tax collected from taxpayers, along with interest. An assessee is entitled to interest on the amount of taxes refunded, including interest on interest, as per Section 244A of the Income-tax Act.

CIT v. Pfizer Ltd.

330 ITR 62 · 2011 · High Court

citing judgments

An insurance claim received on stock in trade constitutes business income and is not an independent source of income.

CIT v. Oriental Insurance Co. Ltd.

125 Taxmann 1094 · 2002 · High Court

citing judgments

Interest levied under Section 201(1A) for delayed remittance of Tax Deducted at Source (TDS) is compensatory in nature, not penal. It is a distinct provision for delayed remittance, similar to interest paid by Revenue on refunds.

CIT v. Gujarat Fluoro Chemicals

358 ITR 291 · 2013 · Supreme Court

citing judgments

An assessee is not entitled to interest on interest under section 244A of the Income-tax Act, particularly regarding interest granted on a refund.

Union Bank of India v. ACIT

72 Taxmann.com 348 · 2016 · ITAT

citing judgments

A tax refund must first be adjusted towards interest payable under Section 244A, with the balance then appropriated against the principal tax amount. This approach does not lead to interest on interest.

CIT v. HEG Ltd.

324 ITR 331 · 2010 · Supreme Court

citing judgments

Under Section 244A, the "amount due" for a refund includes both the principal tax and the interest accrued thereon up to the date the refund is granted. If the revenue fails to pay the full amount of refund, it is liable to pay further interest on the outstanding balance of this total refund, which does not constitute "interest on interest".

India Trade Promotion Organisation v. CIT

361 ITR 646 · 2014 · High Court

citing judgments

When a refund is due to an assessee under Section 244A, the amount must first be adjusted towards the interest payable on such refund, with the balance then adjusted against the tax amount refundable. This follows the principle of Section 140A(1) and means "any amount" in Section 244A includes accrued interest.

Judgments citing interest on refund

M/S Sanofi India Ltd (Formerly Known As Aventis Pharma Ltd, Mumbai vs. The ACIT RG 8(1), Mumbai

In the result, appeal filed by the Revenue is dismissed

ITA 1606/MUM/2007[2003-2004]Status: DisposedITAT Mumbai31 Oct 2023AY 2003-2004

Bench: Shri Vikas Awasthy, Hon’Ble & Shri S. Rifaur Rahman, Hon'Ble

Section 271(1)(c)

interest if assessed can be rectified under Section 154. 15. In view of the above discussion, we are of the view that interest on refund under Section 244A(1) would be assessable in the year in which it is granted and not in the year in which proceedings under Section

ACIT- 3(1)(1), Mumbai vs. Mm/S Sanofi India Limited (Formerly Known As Aventis Pharma Ltd)., Mumbai

In the result, appeal filed by the Revenue is dismissed

ITA 1302/MUM/2007[2003-2004]Status: DisposedITAT Mumbai31 Oct 2023AY 2003-2004

Bench: Shri Vikas Awasthy, Hon’Ble & Shri S. Rifaur Rahman, Hon'Ble

Section 271(1)(c)

Telmos Electronics, Haryana vs. ITO Ward-5, Hisar

In the result, the appeal of the assessee is dismissed

ITA 2807/DEL/2019[2015-16]Status: DisposedITAT Delhi31 Oct 2023AY 2015-16

Bench: Shri Kul Bharat & Shri M.Balaganesh[Assessment Years : 2015-16] Telmos Electronics, Vs Ito, Jindal Chowk, Model Town, Hisar, Ward-5, Haryana-125005. Hisar. Pan-Aacft1673L Appellant Respondent [Assessment Year: 2010-11] Telmos Electronics, Vs Jcit, Jindal Chowk, Model Town, Hisar, Hisar. Haryana-125005. Pan-Aacft1673L Appellant Respondent Appellant By None Respondent By Shri Anuj Garg, Sr.Dr Date Of Hearing 17.10.2023 Date Of Pronouncement 31.10.2023 Order Per Kul Bharat, Jm : Both Appeals Filed By The Assessee Against The Separate Orders Of Ld.Cit(A), Hisar Both Dated 31.12.2018 For The Assessment Years 2015-16 & 2010-11. The Appeals Are Taken Up Together For Hearing & Are Being Disposed Off By Way Of Consolidated Order For The Sake Of Brevity & Convenience.

Section 40A(3)Section 68

made a disallowance of expenditure and made addition of INR 2,98,978/- in this regard. Further, he made addition in respect of interest on refund of INR 36,668/- and also made addition of INR 63,332/- on account of the expenditure which was not found verifiable. 24. Aggrieved

Telmos Electronics, Haryana vs. JCIT, Hisar

In the result, the appeal of the assessee is dismissed

ITA 2655/DEL/2019[2010-11]Status: DisposedITAT Delhi31 Oct 2023AY 2010-11

Section 40A(3)Section 68

Dcti-3(4), Mumbai vs. M/S Idbi Bank Ltd, Mumbai

Accordingly, the grounds raised assessee are allowed and that of the revenue are dismissed

ITA 2081/MUM/2023[2002-2003]Status: DisposedITAT Mumbai30 Oct 2023AY 2002-2003

Bench: Shri Vikas Awasthy () & Ms. Padmavathy S. ()

Section 143(3)Section 244A

notice that the Legislature by the Act No. 4 of 1988 (w.e.f. 01.04.1989) has inserted Section 244A to the Act which provides for interest on refunds under various contingencies. We clarify that it is only that interest provided for under the statute which may be claimed by an assessee from ... applied in assessee’s case since there is a ratio laid down by the higher court that there cannot be any interest on interest on refunds granted to the assessee. The Ld.DR thus submitted that the method of adjusting the tax as 5 ITAs 2080 & 2081/Mum/2023 IDBI Bank Ltd computed

Dcti-3(4), Mumbai vs. M/S Idbi Bank Ltd, Mumbai

Accordingly, the grounds raised assessee are allowed and that of the revenue are dismissed

ITA 2080/MUM/2023[1997-98]Status: DisposedITAT Mumbai30 Oct 2023AY 1997-98

Bench: Shri Vikas Awasthy () & Ms. Padmavathy S. ()

Section 143(3)Section 244A

DCIT, Cir-3(3)(1), Mumbai vs. Sicom Limited, Mumbai City

In the result, the appeal filed by the revenue is dismissed

ITA 2034/MUM/2023[1999-2000]Status: DisposedITAT Mumbai16 Oct 2023AY 1999-2000

Bench: Shri Pavan Kumar Gadale & Shri Gagan Goyalita Nos. 2034 & 2035/Mum/2023 (A.Y:1999-2000 &1998-99) Dcit, Circle-3(3)(1), Vs. M/S Sicom Limited, Room No.609, Solitaire Corporate Aayakar Bhavan, Park, Building No.4, M.K. Road, Guru Nanak Marg, Mumbai-400020. Chakala, Midc S.O, Mumbai-400093. Pan/Gir No. : Aaacs5524J Appellant .. Respondent

Section 143(3)Section 21Section 244ASection 244A(1)

adjusted the granted refund by adjusting principal against the principal component and interest against interest component which has resulted in grant of short interest and refund thereof to the Appellant. ITA.No.2034&2035/Mum/2023 CO.No72&73/Mum/2023. M/s. Sicom Ltd. Mumbai. 1. In this regard, Appellant would like to submit as under ... overlooked the methodology of granting refund and adjustments permitted and not justified in issuing the directions to the AO to grant additional interest on refund u/s 244A(1A) of the Act and relied on the order of the Assessing officer on the computation of interest on refund and prayed

Teradata India Pvt Ltd, Grugram vs. DCIT Circle-3(1), Gurugram

Appeal of the revenue is allowed for AY 2018-19

ITA 2337/DEL/2022[2018-19]Status: DisposedITAT Delhi13 Oct 2023AY 2018-19

Bench: Shri M. Balaganesh & Shri Yogesh Kumar Us

For Appellant: Shri Nageswar Rao, AdvFor Respondent: Shri Rajesh Kumar, CIT DR

Section 143(3)Section 37Section 80G

raised by the assessee are allowed. 17. Ground No. 7 raised by the assessee is challenging the error in computing the interest on refund u/s 244A of the Act. This matter requires factual verification by the ld AO and we direct the ld AO to reconsider the claim of interest

ACIT-Circle-3(1), Gurgaon vs. Teradata India Private Limited, Gurgaon

Appeal of the revenue is allowed for AY 2018-19

ITA 1430/DEL/2022[2018-19]Status: DisposedITAT Delhi13 Oct 2023AY 2018-19

Bench: Shri M. Balaganesh & Shri Yogesh Kumar Us

For Appellant: Shri Nageswar Rao, AdvFor Respondent: Shri Rajesh Kumar, CIT DR

Section 143(3)Section 37Section 80G

Teradata India P.Ltd, Gurugram vs. DCIT, Circle-3(1), Gurugram

Appeal of the revenue is allowed for AY 2018-19

ITA 1248/DEL/2022[2017-18]Status: DisposedITAT Delhi13 Oct 2023AY 2017-18

Bench: Shri M. Balaganesh & Shri Yogesh Kumar Us

For Appellant: Shri Nageswar Rao, AdvFor Respondent: Shri Rajesh Kumar, CIT DR

Section 143(3)Section 37Section 80G

Grand Slam Agencies Pvt Ltd., Mumbai vs. CIT Appeal, Mumbai

In the result, appeal filed by the Assessee stands allowed for statistical purposes

ITA 231/MUM/2023[2015-16]Status: DisposedITAT Mumbai26 Sept 2023AY 2015-16

Bench: Shri N. K. Choudhry, Jm

For Appellant: Sh. B.H. Hansotia, Ld. CAFor Respondent: Sh. Anurag Tripathi, Ld. DR

Section 131Section 250

case, on perusal of CIB information for the AY under consideration, it was observed by the AO that Assessee has received interest on refund to the tune of Rs. 2,73,529/- (Rs. 1,53,197/- in AY 2009-10 and Rs. 1,20,332/- in AY 2010- 11), however

Gurpreet Singh Dhillon, Amritsar vs. ACIT, Circle Int. Tax. 1(2)(2), New Delhi

In the result, appeal of the assessee is allowed as indicated above

ITA 2673/DEL/2022[2018-19]Status: DisposedITAT Delhi25 Sept 2023AY 2018-19

Bench: Shri G. S. Pannua N D Shri Challa Nagendra Prasad

Section 23Section 24Section 251(2)

intio and needs to be deleted. (ii) That the Ld. CIT (Appeals) has grossly erred in adding a Notional Interest on an Interest Free Refundable Security Deposit ignoring the provisions of section 23 and various court decisions on identical facts of the case of the assessee, relying on certain court ... property. 7. Coming to the addition on notional interest on interest free security deposit received, the ld. Counsel submits that the assessee received interest free refundable security deposit of Rs.38,97,000/- being three months rent at monthly rent of Rs.12,99,000/-. The ld. Counsel placing reliance

Kavita Jasjit Singh, Mumbai vs. CIT (A), Cir-3(1)(1), Mumbai

In the result, the appeal by the assessee is partly allowed

ITA 1981/MUM/2023[2017-18]Status: DisposedITAT Mumbai14 Sept 2023AY 2017-18

Bench: Shri Amarjit Singh & Shri Sandeep Singh Karhail

For Appellant: Shri Ketan Ved a/wFor Respondent: Shri P.D. Chougule

Section 250Section 270A

erred in assuming that Refund received in subsequent year was a sufficient event wherein assessee could have offered the Interest, as refund received in subsequent year was short than claimed in the return and no computation relating to it or adjustment of refund (to the extent received short) was given ... Thus, it was impossible on part of assessee to get the information about the interest on refund. 4. On the facts and circumstances of the case and in law, the learned CIT(A) and AO failed to appreciate the fact that no assessee will attempt to evade or underreport those

Bhagwati Lal Madrecha, Rajsamand vs. ITO, Ward-1, Rajsamand

ITA 203/JODH/2019[2008-09]Status: DisposedITAT Jodhpur12 Sept 2023AY 2008-09

Bench: Hearing.”

Section 140ASection 143(2)Section 143(3)Section 148Section 154Section 156Section 220(2)Section 244Section 244(1)Section 244(1)(aa)

income tax (appeal) -1, Udaipur has grossly erred in confirming that the learned assessing officer, Rajsamand has justified in denying the claim of interest on refund which arouse out of self assessment tax paid u/s.244 of Bhagwati Lal Madrecha vs. ITO the Act which was claimed by the assesses through ... unjustified and contrary to the provisions of section 244A of the act hence direction to be given to the assessing officer to provide interest on refund arouse out of self assessment tax paid from the date of payment of self assessment tax till the date of refund granted. 2. That

DCIT 3(3)(2), Mumbai vs. M/S. Small Industries Development Bank of India, Mumbai

In the result, the appeal of the learned Assessing Officer is dismissed

ITA 1813/MUM/2023[2007-08]Status: DisposedITAT Mumbai22 Aug 2023AY 2007-08

Bench: Shri Prashant Maharishi, Am & Shri Narender Kumar Choudhry, Jm M/S Small Industries Dcit, Development Bank Of India Circle 3(3)(1) Sme Development Centre, Office Of The Dy. Commissioner C-11, G Block, Of Income Tax-Circle 3(3)(1), Vs. Room No.609, Aayakar Bhavan, Bundra Kurla Complex, M.K. Road, Churchgate, Bandra East, Mumbai-400 020 Mumbai-400 051 (Appellant) (Respondent) Pan No. Aabcs3480N

For Appellant: Ms. Vinita Shah, CAFor Respondent: Mr. Raj Singh Meel, SR DR

Section 154Section 244A

eligible for interest up to May 2019. The assessee preferred a rectification application before the learned Assessing Officer for non-receipt of interest on refund for the month of January 2019 to May 2019 on 17th May, 2019. Several reminders letters were also addressed to the Assessing Officer. However

Dcitm Circle-14(1)(2), Mumbai vs. M/S Invenire Petrodyne Limited, Mumbai

In the result, the appeal filed by the Revenue stands dismissed

ITA 1793/MUM/2023[2014-2015]Status: DisposedITAT Mumbai21 Aug 2023AY 2014-2015

Bench: Shri Prashant Maharishi & Shri Narender Kumar Choudhrydcit, Circle - 14(1)(2) M/S. Invenire Petrodyne Ltd. Room No. 455, 4Th Floor The Metropolitan, Plot No. C26/27 E-Block, 5Th Floor, Bkc, Aayakar Bhavan, M.K. Road Vs. Mumbai 400020 Bandra (East), Mumbai (Mahrashtra ) -400051 Pan – Aaact0090N Appellant Respondent Appellant By: Shri H.M. Bhatt, Ld. Sr. Ar Respondent By: None (Adjournment Letter) Date Of Hearing: 08.08.2023 Date Of Pronouncement: 21.08.2023 O R D E R Per: N.K. Choudhry, Jm This Appeal Has Been Preferred By The Assessee Against The Order Dated 20.03.2023 Impugned Herein Passed By The Learned Commissioner Of Income Tax (Appeal)/National Faceless Appeal Centre, Delhi (Nfac) (In Short Ld. Commissioner) Under Section 250 Of The Income Tax Act, 1961 (In Short The Act) For Ay 2014-15. 2. In The Instant Case, The Assessing Officer (Ao), Vide Order Dated 15.05.2018 Under Section 154 Of The Act, Though Rectified The Original Order Dated 28.02.2018 Passed Under Section 143(3) R.W.S. 144C (3) Of The Act, However, Did Not Grant Interest On Refund Arising Out Of The Self-Assessment Tax Paid By The Assessee Under Section 244A Of The Act.

For Appellant: Shri H.M. Bhatt, Ld. Sr. ARFor Respondent: None (Adjournment letter)

Section 143(3)Section 154Section 244ASection 244A(1)(aa)Section 250

though rectified the original order dated 28.02.2018 passed under section 143(3) r.w.s. 144C (3) of the Act, however, did not grant interest on refund arising out of the self-assessment tax paid by the Assessee under section 244A of the Act. 2 M/s. Invenire Petrodyne Ltd. 3. The Assessee

Hindustan Unilever Ltd, Mumbai vs. ITO Cir 1(1)(4), Mumbai

In the result, both the appeal of the assessee and the revenue are partly allowed

ITA 5431/MUM/2011[2001-02]Status: DisposedITAT Mumbai18 Aug 2023AY 2001-02

Bench: Shri Vikas Awasthy () & Ms. Padmavathy S. ()

Section 10BSection 80HSection 80I

novo consideration after giving a reasonable opportunity of being heard. 25. With regard to exclusion of 90% of receipts such as, interest, interest on refund, royalty, services, misc. income, compensation, processing charges, we find that the Tribunal has partly allowed the ground for A.Y. 2000-01 by holding as under

ACIT Central Circle-II, Noida vs. Samtel Machine & Projects (P) Ltd., Delhi

In the result, the appeal of the Revenue in ITA No

ITA 1224/DEL/2022[1994-95]Status: DisposedITAT Delhi16 Aug 2023AY 1994-95

Bench: Shri N.K. Billaiya & Shri Yogesh Kumar U.S

For Appellant: Shri D.C. Garg, AdvFor Respondent: Shri Anuj Garg, Sr.DR

Section 140ASection 140A(1)Section 154Section 156Section 220(2)Section 234BSection 244A

shall be adjusted towards the lax payable". However, a similar provision does not exist u/s 244A which provides for calculation of interest on refunds. The instant case pertains to section 244A and hence here is no provision to adjust interest refundable first. 2. That the appellant craves leave ... High Court has held as under: “6. The aforesaid manner of computation is not only applicable to cases where Revenue has to pay interest on refund, but is equally applied when an assessee is in default and interest is payable under Section 220(2) of the Act. Interest payable under

Rajkot Jilla Sahakari Kharid Vechan Sangh Limited, Rajkot vs. The Pr. CIT-1, Rajkot

In the result, the appeal of the assessee is partly allowed

ITA 49/RJT/2022[2017-18]Status: DisposedITAT Rajkot09 Aug 2023AY 2017-18

Bench: Shri Waseem Ahmed & Shri Siddhartha Nautiyal

For Appellant: Shri Gautam Achary, A.RFor Respondent: Shri Shramdeep Sinha, CIT DR

Section 143(3)Section 263Section 80P(2)(a)Section 80P(2)(d)

Year 2014-15 and ₹31,720/- for Assessment Year 2010-11 during the year under consideration. However, the assessee had not disclosed the interest on refund as its income in the return of income. Accordingly, the interest on refund amount of ₹45,684/- is required to be added

Idbi Bank Ltd, Mumbai vs. ACIT, Ltu Circle-1, Mumbai

In the result, appeal of the assessee is partly allowed

ITA 715/MUM/2023[1994-95]Status: DisposedITAT Mumbai07 Aug 2023AY 1994-95

Bench: Shri Kuldip Singh & Shri Gagan Goyal & Idbi Bank Limited, 22Nd Floor, Idbi Tower, Wtc Complex, Cuffe Parade, Mumbai-400 005 ...... Appellant Vs. Acit/Dcit-Ltu, 29Th Floor, Centre No.1, World Trade Centre, Cuffe Parade, Mumbai-400 005 Pan – Aabci8842G ..... Respondent

For Appellant: Shri C. Naresh, Ld. ARFor Respondent: Shri K. C. Selvamani, CIT-DR

Section 143(3)Section 154Section 154(7)Section 244ASection 250

raised by the assessee is dismissed. 5. Section 244A of the Income-tax Act, 1961 ("Act") provides a mechanism for grant of simple interest on refund of "any amount" which becomes due to the assessee under the Act. Ideally, the refund amount along with the interest under Section 244A ... assessee after a substantial delay of 12-17 IDBI Bank Ltd. years. The SC allowed interest for inordinate delay in payment of interest on refund to the assessee. The SC held that where amounts due to the assessee are wrongfully withheld, without the authority of law, then the taxpayer must