In case of refund, interest is to be paid upto the date of refund cheque u/s 244A

The brief fact of the case shows that assessee is engaged in the business of ATM management and allied services. It filed its return of income on 30th November, 2015 declaring total income of ₹217,36,12,673/-. The return was picked up for scrutiny and assessment order was passed under section 143(3) of the Income-tax Act, 1961 (the Act) on 12th December, 2017. The return of income was accepted as it is and no addition / disallowance was made.

The assessee preferred the appeal before the learned CIT (A) aggrieved with the order of learned Assessing Officer as not granting the interest u/s 244A of the Act up to the date of issue of refund cheque. The learned CIT (A) dismissed the appeal regarding to the issue of allowing interest under section 244A of the Act and held that interest on refund is to be granted till the date of grant of refund and not till the date of issue of refund. Therefore, assessee is aggrieved with the decision of the learned CIT (A) and has preferred the appeal before tribunal.

The learned Authorized Representative submitted that the issue is squarely covered in favour of the assessee vide the decisions of Hon’ble Bombay High Court in case of CIT vs. Pfizer Limited [1991] 191 ITR 626 (Bom) and also of City bank, Mumbai Vs. CIT in ITA No. 6 of 2001 as well as the decision of CIT vs. K.E.C International in ITA No. 1038 of 2000. It is further stated that in assessee’s own case for AY 1999-2000 in ITA No. 7096/Mum/2016, the co-ordinate Bench has dealt with this issue in Paragraph no. 8, in favour of the assessee. ITAT direct the learned Assessing Officer to allow interest up to the date of issue of refund under Section 244A of the Act placing reliance on the decision of Hon’ble Bombay High Court as well as assessee’s own case for Assessment Year 1999-2000. Accordingly, appeal filed by the assessee is allowed.

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