Interest on refund where no claim is
needed.
25244.
(1) Where a refund is due to the assessee in pursuance of an order referred
to in section 240 and the 26[Assessing] Officer does
not grant the refund within a period of 27[three months from
the end of the month in which such order is passed], the Central Government
shall pay to the assessee simple interest at 28[fifteen] per cent
per annum on the amount of refund due from the date immediately following the
expiry of the period of 29[three] months aforesaid to
the date on which the refund is granted.
30[(1A) Where the whole
or any part of the refund referred to in sub-section (1) is due to the
assessee, as a result of any amount 31 having been paid by him
after the 31st day of March, 1975, in pursuance of any order of assessment 32 or penalty and such amount
or any part thereof having been found in appeal or other proceeding under this
Act to be in excess of the amount which such assessee is liable to pay as tax or
penalty, as the case may be, under this Act, the Central Government shall pay
to such assessee simple interest at the rate specified in sub-section (1) on
the amount so found to be in excess from the date on which such amount was paid
to the date on which the refund is granted :
Provided that where the
amount so found to be in excess was paid in instalments, such interest shall be
payable on the amount of each such instalment or any part of such instalment,
which was in excess, from the date on which such instalment was paid to the
date on which the refund is granted :
Provided
further that no interest under this sub-section shall be payable
for a period of one month from the date of the passing of the order in appeal
or other proceeding :
Provided
also that where any interest is payable to an assessee under
this sub-section, no interest under sub-section (1) shall be payable to him in
respect of the amount so found to be in excess.]
(2) Where a refund is
withheld under the provisions of section 241, the
Central Government shall pay interest at the aforesaid rate on the amount of
refund ultimately determined to be due as a result of the appeal or further
proceeding for the period commencing after the expiry of 33[three months from the end
of the month in which the order referred to in section
241 is passed] to the date the refund is granted.
34[(3) The provisions
of this section shall not apply in respect of any assessment for the assessment
year commencing on the 1st day of April, 1989, or any subsequent assessment
years.]