COMMISSIONER OF INCOME TAX Vs. SARDARBALWANT SINGH GUJRAL

JUDGEMENT

(1.) BY this reference under s. 256(1) of the IT Act, 1961, (hereinafter referred to as the Act), the Tribunal, Jabalpur, has referred the followed question of law to this Court for its opinion:

(2.) THE material facts giving rise to this reference, briefly, are as follows: for the asst. yr. 1967-68, the assessee was assessed and a demand of Rs. 52,481 was raised against the assessee. This demand included interest under s. 139(8) of the Act and s. 215 of the Act. THE amount so demanded was paid by the assessee, but as a result of the order passed by the AAC, the assessee became entitled to refund of Rs. 22,525. THE demand raised against the assessee was further reduced by the Tribunal and a further refund of Rs. 17,508 was granted. THE assessee claimed interest on the refund of Rs. 22525 and Rs. 17508. THE ITO however, allowed interest on the excess amount of tax only and this order was affirmed on appeal by the AAC. On further appeal, the Tribunal held that interest on the entire amount of refund had to be paid to the assessee under s. 244(1A) of the Act. THE Tribunal, therefore, allowed the appeal and directed the ITO to allow interest on the entire amount aggregating Rs. 40,033. Aggrieved by the order passed by the Tribunal, the Revenue sought reference and it is at the instance of the Revenue that the aforesaid question of law has been referred to this Court for its opinion.

(3.) OUR answer to the question referred to this Court is, therefore, in the affirmative and against the Revenue,. In the circumstances of the case, parities shall bear their own costs of this reference.