[Attachment(s) from 'CA. VMV SUBBA RAO' icainlr@gmail.com [ThaneCAs] included below]
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Tax proposals in Budget 2015-16 which benefits middle class tax payers. The proposals in this regard are as follows : Ø Increase in the limit of deduction in respect of health insurance premium from Rs. 15,000 to Rs. 25,000. o For senior citizens the limit will stand increased to Rs. 30,000 from the existing Rs. 20,000. […] |
- Feb
- 28
- 2015
Benefits to middle class tax payers from Budget 2015
Tax proposals in Budget 2015-16 which benefits middle class tax payers. The proposals in this regard are as follows :
Ø Increase in the limit of deduction in respect of health insurance premium from Rs. 15,000 to Rs. 25,000.
o For senior citizens the limit will stand increased to Rs. 30,000 from the existing Rs. 20,000.
o For very senior citizens of the age of 80 years or more, who are not covered by health insurance, deduction of Rs. 30,000 towards expenditure incurred on their treatment will be allowed.
Ø The deduction limit of Rs. 60,000 towards expenditure on account of specified diseases of serious nature is proposed to be enhanced to Rs. 80,000 in case of very senior citizens.
Ø Additional deduction of Rs. 25,000 will be allowed for differently abled persons under Section 80DD and Section 80U of the Income-tax Act.
Ø The limit on deduction on account of contribution to a Pension Fund and the New Pension Scheme is proposed to be increased from Rs. 1 lakh to Rs. 1.5 lakh.
Ø To provide social safety net and the facility of pension to individuals, an additional deduction of Rs. 50,000 is proposed to be provided for contribution to the New Pension Scheme under Section 80CCD. This will enable India to become a pensioned society instead of a pensionless society.
Ø Investments in Sukanya Samriddhi Scheme is already eligible for deduction under Section 80C. All payments to the beneficiaries including interest payment on deposit will also be fully exempt.
Ø Transport allowance exemption is being increased from Rs. 800 to Rs. 1,600 per month.
Ø For the benefit of senior citizens, service tax exemption will be provided on Varishta Bima Yojana.
Details of tax deductions proposed are as follows:
| · | Deduction u/s 80C | Rs 1,50,000 |
| · | Deduction u/s 80CCD | Rs 50,000 |
| · | Deduction on account of interest on house property loan (Self occupied property) | Rs 2,00,000 |
| · | Deduction u/s 80D on health insurance premium | Rs 25,000 |
| · | Exemption of transport allowance | Rs 19,200 |
| Total | Rs 4,44,200 |
Assessee not entitled to interest on refund of excess self-assessment tax paid by him, rules Delhi HC
March 3, 2015[2015] 55 taxmann.com 1 (Delhi)
IT : Refund of excess self-assessment paid by assessee would not be eligible for interest under section 244A as the provisions of section 244A would not apply thereto
• The provisions contained in Section 115WJ (Advance tax in respect of fringe benefits), Section 199 (Credit for tax deducted), Section 206C (Profits and gains from the business of trading in alcoholic liquor, forest produce, scrap, etc.) or Section 207 (Liability for payment of advance tax) have no connection with the liability to pay self-assessment tax.
• Therefore, clause (a) of sub-section (1) of Section 244A would not apply to refund out of the amount paid as self-assessment tax.
• Clause (b), on the other hand, is residuary provision.Noticeably, for purposes of calculating the liability of the Revenue towards interest on the amount being refunded under Section 244A(1)(b), the beginning point is prescribed as the "date of payment of tax (or penalty)". This expression is defined in the explanation appended to the clause to be indicative of the date of payment of the amount "specified" in the demand notice under Section 156.
• Thus, the legislation makes it clear that for the residuary clause, the amount paid by the assessee (from which refund is to be made) must have been deposited pursuant to demand notice issued by the assessing authority. To put it conversely, the clause would not apply, by virtue of the explanation, in case the excess amount (being refunded) has been paid by the assessee otherwise than in compliance with demand notice or voluntarily. This is the import and effect of the explanation if the language employed thereof is read, understood and construed in its natural and ordinary sense.
• Since the words used are clear, plain and unambiguous, there is no scope for beneficent construction since it would lead to re-legislation, which is impermissible.
• There cannot be a general rule that whenever a refund of income tax is to be paid, the Revenue must necessarily pay interest on the refunded amount. The letter and spirit of the law on the subject is that the party which committed the error in proper calculation (or delay in proper assessment) must bear the burden.
• If the excess amount is paid due to erroneous assessment by the Revenue, having exacted such burden wrongfully and inequitably on the assessee and having retained the excess amount thus received, the reimbursement must be accompanied by payment of interest at the statutorily prescribed rate.
• Conversely, if the assessee is to blamed for the miscalculation (or for delay or, for that matter, want of claim of refund), the Revenue does not owe any interest even if the excess payment of tax is liable to be refunded.
• It is trite that a fiscal statute is to be construed strictly. The claim of interest on refund of income tax has to be pegged on the statutory clauses only.
• There being no allegation that such excess deposit was pursuant to demand by the Revenue, the claim for interest on excess payment voluntarily made cannot be sustained.
• In the result, the appeal is allowed and the impugned order passed by ITAT directing the AO to pay interest to the assessee on the refunded amount is set aside.
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