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How to file rectification u/s 154 (for interest on refund) against assessment done u/s 143(1) by CPC, Banglore.

Vivek Agrawal (GST Practitioner) (181 Points)

04 September 2019

I filed my income tax return of AY 2015-16 on due date and revised the same on 31.03.2017.

CPC Banglore issued me intimation u/s 143(1) alongwith refund. The refund amount was correct but the interest on refund was less calculated.

Now where should I file rectification u/s 154 for the correct interest. As the local AO has not processed my return so he says that application should be submitted to CPC, Banglore.

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12 Replies

Antrika Sinha (student) (315 Points)
Replied 04 September 2019

File application online, after login.

1 Like

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Vivek Agrawal (GST Practitioner) (181 Points)
Replied 04 September 2019

thanks for reply, but under which Tab? i did not find any such tab where application be uploaded Madam

Antrika Sinha (student) (315 Points)
Replied 04 September 2019

https://www.incometaxindia.gov.in/Pages/tax-services/request-for-rectification.aspx

Kapadia Pravin (17259 Points)
Replied 04 September 2019

While interest calculation delay occurred on your part is ignored for interest purpose. The calculation of interest is auto based.
You must be making error in calculation so do it again.
if you are sure then only go for 154 otherwise it's futile.

Vivek Agrawal (GST Practitioner) (181 Points)
Replied 05 September 2019

i don't think it is auto based. lets take a live example of my company's case

AY 2015-16. Return filed on due date 31.10.2015.

TDS/advance tax Rs. 49.85 lakh. Refund due was the same due to "nil" tax.

Intimation of assessement u/s 143(1) issue on 22.12.2016 by CPC Banglore

Refund granted Rs. 49.85 lakh and interest U/s 244A granted Rs. 3.49 lakh only.

While as per my calculation, interest on it should be as under:-

Rs. 49.85 lakh x 21 months (i.e. 1/4/2015 to 22/12/2016) x 6% PA = 5.234 lakh

so the interest should be Rs. 5.234 lakh instead of 3.49 lakh

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Kapadia Pravin (17259 Points)
Replied 05 September 2019

@ Vivek
Interest under 244 A will be for 14 months (1.11.2015 to 22.12.2016)

49.85 lakhs × 6% p.a. = 348950 which you rounded off to 3.49 lakhs.

So Dept is right Sir

Vivek Agrawal (GST Practitioner) (181 Points)
Replied 05 September 2019

OK SIR, THANKS A LOT. I HAD NOT READ THE SECTION PROPERLY

Pranav Aggarwal (487 Points)
Replied 07 September 2019

Hello pravin, I have read section 244A and it tell that if u file return as per 139(1) then refund will be granted from 1st April of AY else from date of filling of return. As per my understanding assesses has filled ITR on due date as per 139(1). Pls elaborate this Pranav

Suresh Thiyagarajan (Student) (3986 Points)
Replied 08 September 2019

1. As per sec 244A interest on the refund will be paid at the rate of 0.5% S.I per month or part of a month.
2. The provision sec 244A has made a distinction with respect to the nature of payment of tax. For simplicity, it has segregated refund on account of self-assessment tax, advance tax and by virtue of chapter XVII-B( TDS).
3. Interest on the refund will be paid from 1st of April relating to the AY if the refund is on account of payment of advance tax.
4. If the refund is on account of payment of self-assessment tax u/s 140A then interest will be paid from the date of payment to the date on which the refund was credited.
5. If the refund is on account of Chapter XVII-B then interest will be paid from the date on which the claim (ROI) for a refund made till the date on which the refund is credited. (as per sec 244A(1B)
6. In your case try segregating advance tax and TDS and calculate interest separately for advance tax and separately for TDS. You have accumulated the entire refund amount and calculated interest. Try this !!
Please correct me if the above solution has an alternative view.

Kapadia Pravin (17259 Points)
Replied 08 September 2019

@ Pranav @ Vivek

In the present case the return for AY 2015-2016 had been filed on 31-10-2015.

The due date of filing was 30-9-2015 under 139(1). So return was filed after due date under 139(1).

Note that for AY 2015-2016 the CBDT had extended return filing date by one month under 119(2) upto 31-10-2015.

Now as far as section 244A is concerned , the due date under 139(1) will be considered as 30-9-2015 only and not the extended due date. And accordingly return was treated filed after normal due date.

Hence interest eligible under 244A was w.e.f 1-11-2015 to 22-12-2016 (14 months only) and not w.e.f 1-4-2015

Hope the query stands clarified.

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Pranav Aggarwal (487 Points)
Replied 09 September 2019

now my query stands cleared.

thanks sir

Umang Dalmia (2 Points)
Replied 27 March 2023

Ideally, due date as envisaged u/s 244A(1)(a)(i) shall be considered after taking into account the due date extended by CBDT and accordingly interest shall be payable from 1st April of the Assessment year. This view has also been accepted by Hon'ble Pune Tribunal in the case of New Era High School Committee -vs.- ACIT (ITA No. 622/Pun/2022).