In Brief
A partnership firm filed returns for the assessment years 1993–94 and 1994–95. After assessment, interest under Sections 234(A)–(C) was levied. The assessee applied to the Settlement Commission to waive the interest claiming hardship, which the Commission partially granted. The assessee then claimed interest on the refund resulting from the waived interest under Section 244(A), but the Assessing Officer refused. The Supreme Court held that once the Settlement Commission exercises its discretionary power to waive interest, an assessee becomes entitled to interest on the resulting refund as a matter of law. The right to interest on refund is statutory and non-discretionary once refund is due, regardless of whether the waiver itself was discretionary.
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