Assessee Entitled To Interest On Refund Under Direct Tax 'Vivad Se Vishwas' Scheme: Gujarat High Court

The Gujarat High Court stated that the assessee is entitled to the interest on refund under Direct Tax Vivad Se Vishwas Scheme. “it is true that the assessee is not entitled to interest under Section 244A of the Income Tax Act, 1961, however, when the assessee has opted for direct tax for Vivad se Visvas Scheme 2020 and filed the application which was approved by the designated authority and refund order is also passed as per the said scheme on 12/05/2022 by the Jurisdictional Assessing Officer, the assessee was entitled to the interest on the amount of refund till the same was paid to the assessee” stated the bench consists of Justices Bhargav D. Karia and D.N. Ray. In this case, the Jurisdictional Assessing Officer passed and uploaded the manual order in the ITBA system on 12/05/2022 which was accounted on CPC 26/07/2022 with refund of Rs.2,20,41,042/- and the refund was issued by the CPC and therefore nothing is pending before the Jurisdictional Assessing Officer. The assessee/petitioner did not validate the bank account with the CPC as such the refund could not be paid to the assessee. The assessee submitted that the assessee has been vigilant for refund which has arisen under the DTVSV Act, 2020, which is not in dispute as per the order giving effect dated 12/05/2022 passed by the Jurisdictional Assessing Officer. The department submitted that the assessee did not validate the bank account with the CPC as such the refund could not be paid to the assessee. No interest is payable to the assessee up to the date when the account was validated by the system. The bench without considering whether it is a fault on part of the assessee to validate the bank account or whether any negligence on part of the department for not releasing the amount of refund, directed the department to pay the amount of interest at the rate of 6% per annum as per the calculation provided amounting to Rs.22,04,104/- for twenty months from 01/06/2022 to 31/01/2024 considering the entire month on amount of Rs.2,20,41,042/-. In view of the above, the bench allowed the petition. Case Title: M/s Total Infratech Pvt. Ltd. v. Assistant Commissioner of Income Tax Case Number: R/SPECIAL CIVIL APPLICATION NO. 20804 of 2023 Counsel for Appellant/ Assessee: Bhaumik Dholariya Counsel for Respondent/ Department: Karan G Sanghani Click Here To Read/Download The OrderCitation: 2025 LiveLaw (Guj) 37

Assessee Entitled To Interest On Refund Under Direct Tax 'Vivad Se Vishwas' Scheme: Gujarat High Court

Mehak Dhiman

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