Facts of the case are, 1. A Trust is having income from interest as his main source of income. It has made Fixed Deposit in bank for a maturity period of three years. Interest is payable on maturity of 3 years. 2. Trust maintains accounts on cash basis. 3. Bank is deducting tax from interest which is not actually paid for first two yeas. 4. Bank has given whole amount of FD with interest (after deducting tax) on maturity. 5. Trust has not shown the interest income for the first two years as it is maintaining accounts on cash basis. It has booked its income in the third year and also claimed credit of tax for (all three years) in third year , as it is maintaining accounts on cash basis and it has filed a income tax return accordingly. 6. Income Tax office has denied to give refund of tax of last two years and given a reason that software on which they are working not allow them to grant the refund of previous two years.
Kindly guide us how to proceed to take the refund of earlier two years?
CAclubindia
