Saktijit Dey ORDER
Saktijit Dey, Vice President
1. Captioned appeal of the assessee arises out of order dated 11.08.2020 of learned Commissioner of Income-tax (Appeals)-8, New Delhi, pertaining to assessment year 2017-18.
2. The assessee has raised multiple grounds, however, the core issue arising for consideration is relating to chargeability of interest under section 220(2) of the Income-tax Act, 1961 (in short 'the Act').
3. Briefly the facts relating to the issue in dispute are, the assessee is a resident corporate entity. As per the case set up by the department, for the assessment year under dispute, the assessee filed its return of income on 30.11.2017, declaring income of Rs.176,52,75,160/-. Return of income was processed under section 143(1) of Act accepting the returned income and determining refund due of Rs.7,59,49,760/-. However, out of the said refund due, an amount of Rs.1,83,69,090/- was adjusted, which comprised of an amount of Rs.91,84,590/- being outstanding Fringe Benefit Tax (FBT) demand under section 115WE of the Act for the assessment year 2009-10 created on 04.01.2011 and interest under section 220(2) thereon amounting to Rs.91,84,500/- i.e. up to the date of processing of the return on 26.05.2019. Aggrieved with the adjustment of refund in the intimation issued under section 143(1) of the Act, the assessee preferred an appeal before learned first appellate authority. Assessee's case before learned first appellate authority was, it had deposited FBT for assessment year 2009-10 amounting to Rs.73,45,724/- and income tax of Rs.7,36,54,276/- at the time of filing of return of income for the said assessment year. However, the Revenue adjusted the entire sum against the income tax liability resulting in FBT demand of Rs. 91,84,590/-, including interest component of Rs.18,38,871/-. It was the further case of the assessee that no intimation or notice of demand was served on the assessee qua the FBT liability. It was submitted, suo motu, the assessee deposited FBT demand of Rs.91,84,590/- on 16th October, 2018. Despite that, FBT demand of Rs.91,84,590/- was again recovered from the refund due for the assessment year 2017-18 along with the interest amounting to Rs.91,84,500/- levied under section 220(2) of the Act. Thus, the assessee submitted that since no demand notice concerning the interest component of FBT demand was served on the assessee, the liability does not ensue.
4. After considering the submissions of the assessee in the context of facts and materials on record, learned Commissioner (Appeals) having found that the assessee had suo motu deposited FBT demand of Rs.91,84,500/- on 16th October, 2018, directed the Assessing Officer to give credit of such payment and set off with the demand dated 04.01.2011. He further directed that since the assessee has deposited FBT demand on 16th October, 2018, the excess demand of the very same amount recovered from the assessee should be refunded.
5. Insofar as the interest component under section 220(2) is concerned, learned Commissioner (Appeals) observed that such interest shall be chargeable till the date of payment of demand. As regards assessee's contention that no interest is payable in terms of section 115WJ of the Act, learned Commissioner (Appeals) held that since the issue in dispute arises out of an order passed on 04.01.2011 for assessment year 2009-10, it cannot be the subject matter of the appeal for assessment year 2017-18. Accordingly, he disposed of the appeal.
6. Before us, learned counsel appearing for the assessee submitted that as per provi........