Mumbai ITAT grants interest on tax refund even if refund was less than 10% of gross tax

Facts:

a) The assessee claimed interest under section 244A. The Assessing Officer held that, since the refund determined was less than 10 per of gross tax, no interest would be payable to the assessee under section 244A and thus, he rejected the rectification application.

b) On appeal, the Commissioner (Appeals) affirmed the order of the Assessing O􀁹icer. The Tribunal held in favour of assessee as under:

1) There was no proper justification on the part of the revenue to withhold the amount of refund beyond the date of issuance of intimation/order under section 143(1).

2) Upto the date of passing order/intimation under section 143(1), no interest shall be payable by the department to the assessee because of clear provisions of law on the statute in this regard, but for the period of delay in issuing the refund after the date of passing of the order under section 143(1), the assessee is entitled for interest.

3) Thus, the Assessing Officer was directed grant the interest under section 244A for the period falling between the date of passing of order under section 143(1) and actual date of granting of refund, at the rate of interest as would have been applicable if the refund amount would have been for an amount more than 10 per cent of the gross tax. - [2016] 73 taxmann.com

228 (Mumbai - Trib.)

Now AOs to issue scrutiny notice along with questionnaire to convey compliance requirement

It was noticed that while issuing the initial/first notice for cases selected under scrutiny, Assessing Officers (‘AO’) do not convey the specific compliance requirements like production of accounts, furnishing of documents, information, evidences, etc.

Taxpayers or their authorised representatives needs to appear before the AO as they are required to comply with the statutory notice issued by the AO. Thus, their appearance before the AO does not serve any fruitful purpose except recording of their presence. This causes undue hardship to the taxpayers and unnecessary wastage of their time.

Sec. 143(1) intimation won't be deemed as completion of assessment to bar filing of revised return, rules HC

Issue of intimation under section 143(1) could not amount to completion of assessment so as to bar an assessee from filing a revised return under section 139(5)

The issue that arose before the High Court was as under-

Whether issue of intimation under section 143(1) could not amount to completion of assessment so as to bar an assessee from filing of revised return under section 139(5)?

The High Court held in favour of assessee as under-

1)The provision of section 143(1)(i) contemplates an assessment without prejudice to the provisions of Section 143(2).

2)Section 143(2) allows Assessing Officer (AO), if he considers it necessary, to serve on the assessee a notice requiring him, on a date to be specified therein, to attend his office or to produce or cause to be produced thereon, any evidence on which the assessee may rely on in support of the return and after taking into account all relevant materials the AO shall by an order in writing make an assessment.

3)Thus, AO could resort to the provisions of section 143(2) even after issuing of intimation under section 143(1) and, therefore, processing of return under section 143(1) could not be said to be completion of assessment so as to restrict assessee from filing a revised return under section 139(5)- TATA METALIKS LTD V. CIT [2014] 52 taxmann.com 480 (Calcutta)