MERCK LTD. Vs. TARKESHWAR SINGH

JUDGEMENT

(1.) THIS petition under Art. 226 of the Constitution of India challenges an order dt. 28th May, 2004 passed by respondent No. 1 i.e. CIT in revision under s. 264 of the IT Act, 1961 (the Act) in respect of asst. yr. 1986 -87. By the impugned order dt. 28th May, 2004, the CIT rejected the petitioners claim for interest on the delayed refund of self assessment tax by the Revenue for the period from its payment i.e. 30th July, 1986 till the date of refund i.e. 30th March, 1998. The petitioner had made a claim for interest under s. 244(1A) of the Act.

(2.) ON 31st July. 1986, the petitioner filed its return of income for asst. yr. 1986 -87 declaring its total income at Rs. 1,27,74,430. By an order dt. 28th March, 1989 passed under s. 143(3) of the Act, the AO assessed the petitioner to an income of Rs. 1,60,00,970. The tax payable was determined at Rs. 80,70,506. The assessment order dt. 28th March, 1989 after giving credit for taxes paid demanded the balance tax along with interest of Rs. 24,90,126 from the petitioner.

(3.) CONSEQUENT to the orders dt. 11th Aug., 1997 of the Tribunal, the AO by two orders dt. 30th March, 1998 gave effect to the same and granted refund of Rs. 23,29,486 including interest. On 29th Aug., 2000, the petitioner by rectification application pointed out to the AO that there was a shortfall in payment of interest to the extent of Rs. 6,74,002 in view of interest payable on self assessment tax. The AO by his order dt. 19th March, 2001 rejected the application on the ground that interest of Rs. 6,76,002 claimed is attributable to self assessment tax paid and the same was inadmissible under s. 244(1A) of the Act.