ITAT orders to grant Interest on Refund under Section 244 of the Income Tax Act, 1961 to Tata Steel [Read Order]

The Income Tax Appellate Tribunal (ITAT), Mumbai ordered the AO to grant interest under Section 244 of the Income Tax Act, 1961 to the Tata Steel Limited.

In this case, the AO had finally adjusted the refund of Rs. 23,91,54,333/- against demand raised on the assessee, M/s Tata Steel Limited.

The issue raised in this case was whether the assessee is entitled to interest under Section 244(1A) of the Act on the refund of Rs. 23,91,54,333/- for the period from October 29, 2013, to November 21, 2017, in the facts and circumstances of the case.

In other words, the issue to be decided by the tribunal is whether the assessee is entitled to interest under Section 244 of the Act for the period from October 29, 2013, to November 21, 2017. It is not in dispute that the entire taxes were ultimately paid by the assessee on October 29, 2013, either by way of physical payment or by way of adjustment of refund.

The tribunal consists of a Judicial Member C.N. Prasad and a Technical Member, M. Balaganesh held that this is not a case of assessee claiming interest on interest. Hence, the ITAT directed the AO to grant interest under Section 244 of the Act on the sum of Rs. 23,91,54,333/- for the period from October 29, 2013 to November 21, 2017.

“We find that while giving effect to the Tribunal order in the proceedings dated 21/11/2017 passed by the AO, the AO had finally determined the refund of Rs.23,91,54,333/- which was ultimately adjusted against the demand of A.Y.2009-10,” the tribunal said.