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[2007] 292 ITR 143 (ALL.) HIGH COURT OF ALLAHABAD Commissioner of Income-tax v. Haji Abdul Hameed R.K. AGRAWAL AND MS. BHARTI SAPRU, JJ. IT REFERENCE NO. 135 OF 1998 APRIL 12, 2007 Section 154 of the Income-tax Act, 1961 - Rectification of mistakes - Apparent from records â–  Where under section 241(2) three orders withholding refund were passed, question as to whether for purposes of computing interest under section 244(2), second and third orders withholding refund were to be taken as continuation of first order or as separate orders, was debatable issue and as such order granting interest under section 244(2) could not be said to suffer from mistake apparent from record [Assessment years 1962-63, 1970-71, 1971-72] On giving effect to the Appellate Tribunal's order dated 30-6-1976, for the assessment years 1962-63, 1970-71 and 1971-72, a refund of Rs. 11,44,656 became due to the assessee. This refund was withheld three times in terms of section 241 till 31-12-1977, and then till 31-7-1978 and lastly till 31-10-1978 vide orders passed by the Commissioner on 30-9-1977, 15-5-1978, and 31-7-1978, respectively. Interest under section 244(2) of Rs. 3,54,733 was allowed to the assessee vide order dated 21-5-1979. Subsequently, the Assessing Officer passed an order under section 154 withdrawing interest to the tune of Rs. 1,02,987 on the premise that as the period of three months was not excluded from each of the three orders under section 241 for calculation of interest payable under section 244(2), as per the order dated 21-5-1979, interest to the extent of Rs. 1,02,987 was allowed in excess. Held that under sub-section (2) of section 244 interest for a period of three months from the end of the month in which the order withholding the refund is passed is not payable. That might be construed in respect of the order dated 30-9-1977, but in respect of other two orders it was highly debatable as to whether the two orders passed subsequently withholding the same amount of refund would be treated as the orders in continuation of the earlier order or fresh orders, on which two views were possible. Therefore, the issue was debatable. Such mistake could not be…

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