Central board of direct taxes issued a directive that a taxpayer should get interest on refunds unless in te case when there is assessee’s default.
The directive was triggered by an observation made by the Delhi High Court on 14 March 2013. According to the court, when the delay is not attributable to the assessee, but to the revenue department, the interest should be paid under Section 244A of the Income-Tax Act.
CBDT also clarifies that if a taxpayer denies the right of refund, the AO must take it into written explanation of the deny of interest.
Section 244A of the income tax act provides that a taxpayer is entitled to have te interest of 6% annually from the first day of April of the assessment year to the date on which the refund is granted. The refund may be either in the case of TDS deduction or advance tax. However no interest is given if the refund amount is less than 10% of tax paid.
Tags-income tax refund,income tax refund status,interest on it refunds,it refunds,interest rate of refund,income tax refunds
