High court allowed Additional Interest.

"It is not my interest to pay the principal, nor my principle to pay the interest".

Tone of order is set by mentioning the above sentence in opening para of order delivered by Single judge of Karnataka High Court

Wipro preferred writ before HC against non granting of additional interest under section 244A (1A) of the Act.

Extract of section244A

(1A) In a case where a refund arises as a result of giving effect to an order under section 250 or section 254 or section 260 or section 262 or section 263 or section 264, wholly or partly, otherwise than by making a fresh assessment or reassessment, the assessee shall be entitled to receive, in addition to the interest payable under sub-section (1), an additional interest on such amount of refund calculated at the rate of three per cent per annum, for the period beginning from the date following the date of expiry of the time allowed under sub-section (5) of section 153 to the date on which the refund is granted.

Extract of ITAT ORDER
1. On 14A issue, issue was set aside to the record of AO to re-examine the same in the light of orders of ITAT in assessee’s own case for earlier assessment years.

5. Issue of computation of profits of overseas development centre (ODC), was remitted to the record of AO and assessee was directed to file relevant details as required by AO so that AO can ascertain the market value of goods and services transferred.

7. Issue of taxability of interest received u/s. 244A was remitted to the record of AO for limited purpose of computation of interest.

On TP issue, following earlier order, issue was remitted to the file of TPO to follow the directions given for earlier AYs.

HC Held that

ITAT has held some issues definitively, and on some other, it had remitted the matter to the AO/TPO for a limited consideration afresh; in respect of issues in Sl. Nos.1, 2 & 7 in the above summary, there is virtually a direction warranting OGE.

It cannot be a case of setting aside entire assessment; it is a case of setting aside an assessment only on specific issues;

In respect of issues where there is a definitive holding, section 153(5) would apply and the AO has to pass OGE within the time specified thereunder

Even according to the argued case of the Revenue, regardless of its sustainability only that part of the order giving effect to ITAT order which relates to the Transfer Pricing Adjustment constitutes a fresh assessment; the balance portion of the order which otherwise warranted giving effect to the ITAT order, does not amount to a fresh assessment or reassessment.

Interestingly, High court has given direction that additional interest should be paid within eight weeks from submitting fresh claim and if there is any delay thereafter , revenue shall pay further interest at 1.5% pm which is to be recovered from erring officer.