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Interest for delayed refund — a clarification

I had the occasion to read the Tax Forum questions and answers on May 1, 2006, under the heading "Consumer forum is not the remedy for delay in refund". In the last paragraph thereof it is stated as follows:

"Incidentally the reader will be entitled to interest along with the refund for the period of delay under Section 244, if refund is not issued within three months from the end of the month in which the return is filed".

I may point out that Sec. 244 of the Income-tax Act does not specify any such interest and, in any case, the said section is not applicable any more since, under Sec. 244(3), its validity is only for the assessment years prior to 1989-90 from April 1 of the relevant assessment year to the date of granting of refund and, on any other type of tax paid, from the date of payment of such tax till the date of grant of refund.

Tax Forum is obliged for the above clarification to G. Muthuramakrishnan, Tiruchi. The taxpayer is entitled to interest on delayed refund under Sec. 244A of the Income-tax Act and not under Sec. 244, which has been substituted with effect from April 1, 1989 by Sec. 244A.

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