Interest levied u/s234B of I.T.Act, assessee has liberty to show it before AO.

Facts in Brief:

1. Assessee is a company incorporated in Hong Kong providing service/facilities for the processing of data through computer software.

2. The assessee company is a non-resident in India.

3. It has declared 'nil' income in the return of income filed with the Revenue and claimed refund amounting to Rs. 8,73,61,947/- being the entire amount of TDS.

4. It was rejected.

On appeal ITAT held,

5. we are of the opinion that it would serve the interest of justice if all these appeal except ITA No. 6888/Mum/2011 are restored back to the file of the AO with a direction to re-adjudicate the issues in accordance with law after giving further opportunity to the assessee and placing all the material required for adjudication of the issues raised in the present appeals. After giving opportunity the AO will readjudicate all the issues raised in the present appeals as per provisions of law.

6. Similar is the position in respect of Ground No. 1.3 & 1.4 and additional ground No. 1.5 in which the assessee has raised grievances regarding rates of tax to be applied on the above receipts. All these issues on merits are to be readjudicated as per law in ITA No. 6762/Mum/2009 & 219/Mum/2010 being cross appeals in respect of assessment year 2006-07 against original assessment.

7. The other issues raised in ITA No. 6888/Mum/2011 regarding leviability of interest under section 234B which was admitted to be consequential and with a rider that assessee has liberty to show before AO why it is not liable for levy of interest under section 234B, the matter would be re-adjudicated in original assessment proceedings as discussed in para 5.3 of this order".

8. Based on the above decision of the ITAT in the preceding year(s), the AR submitted that for the sake of consistency, the issue, in the current years, deserved to be restored to the file of the AO.

9. The DR did not object to the submission of the AR for restoration of the issue to the file of the AO.

10. On hearing both the sides, we are of the view that since the preceding years were awaiting adjudication at the AO stage, it would be inappropriate for us, to come to any conclusion. We, therefore, set aside the orders of the revenue authorities and restore the issue to the file of the AO for a fresh adjudication, in line with the decision taken by he AO in the preceding years(s). Needless to mention, adequate and reasonable opportunity shall be given to the assessee, to present its case.

Case Reference - Atos Information Technology Hk ... vs Assessee.