Interest on tax refund

Dear Sir,

You cannot claim a higher rate of interest from the dept as 6%p.a. is the defined rate of interest which the dept is required to pay, no matter even if you have suffered a personal loss of 18 % on that amount.

The rate of interest is calculated from the date of payment of tax to the date of signing of refund order. If the interest paid to you is of the lesser period of time than this, then you can claim for the balance period from the dept. 

Regards

1) you cannot claim interest than 0.5% per month

2) You can claim interest for delay of AO and no fault of assesse. Intruction No 7/2013 of CBDT  dated 15th July 2013  which is based on Delhi High court Judgement clearly talks of Payment of interest for no fault of assesse. 

The Instruction is attached herewith for your benefit. You can apply to your AO with xerox copy of this instructions. I hope this helps.

ALL REFUND SEEKERS SHOULD CLAIM FOR INTEREST U/S 244  WHERE TDS IS NOT VISIBLE AT THE TIME OF ASSESMENT AND  SUBSEQUENTLY THE  TDS IS RECTIFIED. AND REFUND IS ISSUED AFTER RECTIFICATION. 

High Court Judgement and Instruction no 7 is clear. Please comment - Experts. 

Even my case forAY 2008-09 and 2009-10 is pending.

Thanks for the reply. Now, can you help me interpreting the exact clause in the IT Act - Section 244A, which talks of 2 different rates >>>  0.5% as also 1%. In that context, wont my refund classify under the 1% aspect?

Thanks... Sharad

Can you please tell me what was the amt of Tax paid and the amt of refund and the assesment Year. Experts in Accoubts and tax laws please help hm out. 

I am a Bridge Engineer Designing Bridges. 

Two things you should bear in mind 

1) No Interest will be paid on  Self assesment  tax  which is paid in excess than required because it is the calculation error by assesse.

2) No interest will paid on  refunds which is less than 10% of the Tax determined.