Introduction
3.1 As stated in PART 1 of this write-up, the apex court in the case of Sandvik Asia Ltd. [Sandvik] took the view that the expression ‘amount’ appearing in section 244(1A) refers not only to the tax but also to the interest and it cannot be limited to the tax paid in pursuance of the assessment order. Accordingly, the Court held that in view of the express provision of the Act, an assessee is entitled to compensation by way of interest for delay in payment of amounts lawfully due to the assessee which are withheld wrongfully and contrary to law. The Court also further took the view that even if there is no provision in the Act for payment of compensation, the compensation for delay is required to be paid as the Act itself recognises the principle that the Revenue is liable to pay interest when excess tax was retained and the same principle should be extended to the cases where interest was retained. For this, the Court also relied on the judgment of the Apex Court in the case of Narendra Doshi referred to in para 1.4.1 of PART 1 of this write-up.
3.1.1 Subsequent to the judgment of the Apex Court in Sandvik’s case, the CBDT issued Instruction No. 2 dated 28th March, 2007 which is worth noting and hence the relevant part thereof is reproduced hereunder [209 CTR (Statute) 17]:
“Sub: Section 244A of the Income-tax Act, 1961 – Refunds – Interest on – Grant of interest on refunds under section 244A simultaneously with issue of refund.
In terms of section 244A of the Income-tax Act, 1961 (Act), an assessee is entitled to receive interest calculated in the manner provided in the said section on the amount of refund due under the Act. The interest is to be granted simultaneously with the refund and there should normally be no reason to grant refund without adding the entitled interest. In the case of Sandvik Asia Ltd. vs. CIT (2006) 200 CTR (SC) 505 : (2006) 280 ITR 643 (SC), the Hon’ble Supreme Court, inter alia, adversely commented upon the delay in grant of interest on refund and awarded compensation to the assessee for the said delay by the Department. While taking this view, the Supreme Court referred to the judgment of the Gujarat High Court in the case of D.J. Works vs. Dy. CIT (1992) 102 CTR (Guj) 2 : (1992) 195 ITR 227 (Guj) wherein the High Court had held that though there is no specific provision for payment of interest on interest, but if interest on the refund is wrongfully retained, interest on interest would be payable. The Court further held that even assuming that there was no provision in the Act for payment of compensation, on general principles, compensation was payable to the assessee for the delayed payment of interest. The Court also recommended that action be initiated against the officers responsible for the delay.
2. It is necessary to remind all Assessing Officers that while granting refund to the assessee, care should be taken to ensure that any interest payable u/s. 244A on the amount of refund due should be granted simultaneously with the grant of refund and there should, in no case, be any omission or delay on the grant of such interest. Failure to do so will be viewed adversely and the officer concerned will be held personally accountable, inviting appropriate action.
3. These instructions may be brought to the notice of all officers working in your region for strict compliance. The Range Officers should be directed to carry out periodic test checks of cases within their jurisdiction to ensure that provisions of section 244A are scrupulously implemented. ………………”
3.1.2 After the above judgment of the Apex Court, the High Courts as well as the Tribunal have followed/ explained the same in various cases such as Motor General Finance Ltd. [320 ITR 881 (Del)], Gujarat Fourochemicals Ltd. [300 ITR 328 (Guj)], State Bank of Travancore [292 ITR (AT) 56 – Cochin), Delhi Tourism Transportation Corp. [(2012) 35 CCH 046 – Del Trib], Deutsche Bank AG [ITA Nos. 3789, 3790 & 4282/Mum/2010], etc. In these cases, the judgment of the apex court in Sandvik’s case is understood as laying down the prin-ciple that the assessee is also entitled to interest on unpaid interest receivable by him on the refund due to him. When the correct interest is paid by the Revenue along with the refund, this issue was not considered as relevant. It may also be noted that the Ahmedabad Bench (TM) of the Tribunal in the case of Nirma Chemical Works Ltd. [125 TTJ 487] did not follow Sandvik’s case on the ground that it was a case prior to the assess-ment year 1989-90 (i.e., it was not rendered in the context of the provisions of section 244A) and also on the basis that it was a case where the interest has been granted in a writ as compensation and not as interest on interest under the Act. According to the Tribunal, section 244A(1)(a) grants interest only on that amount of refund which is out of the tax paid by the assessee by way of advance tax/TDS/TCS and not on the amount of interest due to the assessee but withheld by the Revenue. Section 244A(1)(b) provides for interest on refund in any other case in which case the interest has to be calculated from the ‘date of payment of the tax or penalty’. The Tribunal also stated that the Apex Court also considered certain deci-sions laying down a ratio that “the amount of refund” includes refund of tax as well as interest. According to the Tribunal, even in such a case the assessee will not be entitled to interest as unlike section 244 which grants interest on any amount of refund, section 244A provides for grant of interest on the amount of refund out of any tax/penalty paid by the assessee or collected from him and in any case, otherwise it requires the date of payment by the assessee. Even if the inter-est due to an assessee is considered to be a ‘refund of any amount’ u/s. 240 or under the opening part of section 244A(1) as held by the courts in certain cases, ‘it would not entitle an assessee to further interest on that amount of interest either under Clause (a) of section 244A(1) as it was not a refund out of any tax paid by him or collected from him; nor under Clause (b) of section 244A(1) as the interest is to start from the date of payment of tax or penalty and in the case of refund of interest, there cannot be the date of payment by an assessee’. Further, according to the Tribunal, the Supreme Court made it clear in para 40 of the judgment that there cannot be any doubt that the amount of interest on the refunded amount is as per the provisions of law as it then stood and on the peculiar facts and circumstances of the case. When a specific provision has been made under the statute, such provision has to govern the field. The Tribunal then further stated that the AO is the statutory author-ity. The Tribunal, as an appellant authority, is likewise a statutory authority. It is not a court of equity. Therefore, it has to act as per the provisions of the Act and if a benefit or a relief is not available to an assessee under the Act, it cannot be granted on the grounds of equity or the general provisions of law as can be granted by the courts in their writ jurisdiction. Referring to the full Bench Judgment of the Bombay High Court in the case of Carona Sahu Co. Ltd. [146 ITR 452], the Tribunal held that though interest is compensatory in character, yet there is no right to receive interest other than by right created under a statute. According to the Tribunal, section 244A apparently reveals that there is a liability to pay interest on delayed payment of refund amount but the section does not provide for payment of any interest on interest, even though there is a delay in payment of such interest. Finally, the Tri-bunal held that looking to the language of section 244A, the assessee was not entitled to any interest on interest as it was not a case of the refund of amount out of any tax paid by or collected from the assessee nor it has a date of payment by the assessee from which it can run. It may also be noted that the phrase ‘date of payment of tax or penalty’ is also defined in the Explanation to section 244A(1) to mean that ‘the date on and from which the amount of tax or penalty specified in the notice of demand issued under section 156 is paid in excess of such demand’. However, it is worth not-ing that even u/s. 244(1A), the interest was required to be calculated from the date of excess payment and still the Apex Court in Sandvik’s case took the view that assessee is entitled to interest on unpaid amount of interest as mentioned in para 3.1 above. Under the circumstances, to what extent the distinction drawn by the Tribunal in the context of section 244A(1)(b) should hold good could be a matter of debate. It may also be noted that in this case the Tribunal did not have the benefit considering the judgment of the apex court in the case of H.E.G Ltd. and its effect referred to in para 3.1.3 to 3.1.3.3 as the same was delivered subsequently. As such, the view taken by the Tribunal in this case may not be necessarily regarded as correct.
3.1.3 The judgment of the apex court in the case of HEG Ltd. [324 ITR 331] is also worth noting. In this case, the Court was dealing with batch of appeals. At the outset, the Court stated that if a question is not properly framed then, at times, confusion arises resulting in wrong answers and the present batch of appeals is an illustration thereof. For this purpose, the Court noted the facts of the case of one of the appeals [SLP(SC) No. 18045/2009] for the assessment year 1993-94 and stated that the question framed by the Revenue with regard to the entitlement of the assessee to claim interest on interest u/s. 244A is erroneous. As such, the Court clarified that this is not a case where the assessee is claiming com-pound interest or interest on interest as is sought to be made out by the Revenue. The Court then dealt with a question as to what is the meaning of the words “refund of any amount becomes due to the assessee” in section 244A? In this context, the Court rejected the argument of the Revenue that the words “any amount” will not include the interest which accrued to the assessee for delay in refunding the amount and held as under [Page No. 333]:
“………….We see no merit in this argument. The interest component will partake of the character of the “amount due” under section 244A. It becomes as integral part of Rs. 45,73,528 which is not paid for 57 months after the said amount became due and payable. As can be seen from the facts narrated above, this is the case of short payment by the Department and it is in this way that the assessee claims interest u/s. 244A of the Income-tax Act. Therefore, on both the aforestated grounds, we are of the view that the assessee was entitled to interest for 57 months on Rs. 45,73,528. The principal amount of Rs. 45,73,528 has been paid on 31st December, 1997 but net of interest which, as stated above, partook of the character of “amount due” u/s. 244A.”
3.1.3.1 From the available facts in the above judgment, it seems that the total tax paid had two components, viz., TDS (Rs. 45,73,528) and tax paid after the original assessment (Rs. 1,71,00,320). It seems that the assessee was entitled to refund of Rs. 2,16,73,848 consisting of the above two components from which, it appears that refund of Rs. 45,73,528 (TDS component) was delayed by 57 months and the assessee had claimed statutory interest u/s. 244A for this delayed refund of Rs. 45,73,528 for a period from 1st April, 1993 to 31st December, 1997. Therefore, it appears that the amount of Rs. 45,73,528 represents the principal amount and does not seem to include any interest. As such, there is no clarity on the facts in the context of the above view expressed by the apex court.
3.1.3.2 It may be noted that in the above case, in the Head Notes of the ITR, references are given to various appeal numbers and it is also mentioned that such appeals are arising out of the judgment of the MP High Court in the case of CIT vs. H.E.G. Ltd. reported in 310 ITR 341 and of the Madras High Court in the case of Cholamandalam Investment and Finance Co. Ltd. reported in 294 ITR 438. There seem to be some confusion in this regard. The facts dealt with in the text of the judgment of the apex court are, it is stated, for the assessment year 1993-94 [seems to be in the case of H.E.G. Ltd.] and it appears that this assessment year was not covered in the judgment of the MP High Court reported in 310 ITR 341 in which the High Court has held that grant of interest on interest is permis-sible and this position does not change u/s. 244A. The judgment of the MP High Court for the assessment year 1993-94 could not be verified as the same was not available. Accordingly, in view of lack of clarity on the factual position, it seems difficult to take a view that the judgment of the MP High Court reported in 310 ITR 341 has been affirmed by the apex court as mentioned in the Head Notes of the ITR. This position gets further clarified by the fact that the apex court has also stated that the question does not relate to interest on interest. Notwithstanding this position, this judgment of the apex court supports the view that the words ‘amount due’ appearing in section 244A include interest and the interest component will partake of the character of the ‘amount due’ under section 244A. Similar view was also taken in Sandvik’s case in the context of section 244(1A) as mentioned in para 2.16 of PART 1 of this write-up.
3.1.3.3 The effect of the judgment of the apex court in H.E.G. Ltd. (supra) has been explained by the Delhi High Court in a recent judgment dated 6th September, 2013 in the case of India Trade Promotion Organisation [ITA Nos. 167 & 168 of 2012]. This judgment has been delivered in the context of claim of interest u/s. 244A on account of delayed payment of interest after granting the refund of the principal amount. The High Court explained that if the refund does not include interest due and payable on the amount refunded, the Revenue would be liable to pay interest on the shortfall. This does not amount to payment of interest on interest. The Court has also explained this with example. According to the Court, the claim of such interest is on account of the shortfall in payment of the amount due and payable (including interest) and not a claim of interest on interest.
Gujarat Flourochemicals Ltd. vs. CIT – 300 ITR 328 (Guj)
4.1 The issue with regard to the entitlement of interest on interest also came up before the Gujarat High Court in the above case after Sandvik’s case. In this case, the brief facts were: The assessee had made certain payment to a foreign company (non-resident) and in that context on making an application for non-deduction of tax, the Assessing Officer (AO) had directed the assessee to deduct tax @ 30% on the basis which the assessee had deducted certain amount of tax and paid to the Government (it seems – somewhere in June 1987). Subsequently, the assessee realised that tax deducted and paid was excess on account of non-application of the principle of grossing up to its case at the relevant time and accordingly, claimed refund for such excess payment of tax which was granted (Rs. 10,26,868) by the AO vide order dated 30th November, 1990. Subsequently, the assessee claimed interest on such refund for a period from 1st July, 1987 to 30th November, 1990. There is some confusion in facts on terminal date i.e., 30-11-1990 or 13-11-1990. However, this is not relevant. The claim of the assessee was rejected by the CIT, CCIT as well as the CBDT. On these facts, the issue of grant of interest on such refund of excess tax paid came up before the Gujarat High Court in a writ petition filed by the assessee.
4.1.1 For the purpose of deciding the issue, the Court noted that the question as to whether the assessee is entitled to compensation by way of interest for delay in payment of amount lawfully due to the assessee which are withheld wrongly and contrary to law stands concluded by the apex court in Sandvik’s case. The Court also noted the subsequent instruction (referred to in para 3.1.1) issued by the CBDT in this regard. Based on this, the Court took the view that the assessee is entitled to interest as claimed and directed the Revenue to pay interest at the rate of 9% from 1st July, 1987 to 30th November, 1990. The Court also further directed to pay running interest at the rate of 9% on the amount of interest which may be granted to the assessee in pursuance of the judgment of the High Court.
4.1.2 It may be noted that in the above case, the Gujarat High court took the view that the assessee is entitled to interest on the amount refunded to the assessee as well as interest on such interest on general principles effectively relying on the judgment of the Apex Court in Sandvik’s case.
CIT vs. Gujarat Flourochemicals – 348 ITR 319 [SC – Division Bench]
5.1 It seems that the above judgment of the Gujarat High Court came up for consideration before the Division Bench of the apex court at the instance of the Revenue. The facts are not given in the case before the apex court. The Court also stated that this controversy arises in number of cases pending before the apex court. While dealing with this case, the Court noted that the short point which arises in the present case is: “What is the character of Tax Deductible at Source (TDS)/ Advance Tax under the Income-tax Act, 1961.” The Court further stated that the question which arises in this case is, whether interest is payable by the Revenue to the assessee if the aggregate of installments of Advance Tax/TDS paid exceeds the as-sessed tax? The Court also mentioned that this controversy arises in a number of cases pending before the Apex Court. Interestingly, it seems that, this question does not refer to liability of the Revenue to pay interest on interest but only refers to the liability of the Revenue to pay interest on excess payment of tax (i.e. Advance Tax/ TDS). However, it is also worth noting that the High Court had directed the Revenue to pay running interest on the amount of interest as mentioned in para 4.1.1.
5.1.1 In the above case, the assessee had relied on the judgment of the apex court in Sandvik’s case. Referring to this, the Court stated that the main issue which arose for determination in Sandvik’s case was whether the assessee was entitled to be compensated by the Rev-enue for delay in paying to it the amounts admittedly due. The Court also doubted the correctness of the judgment in Sandvik’s case. In this context, the Court stated as under:
“The argument in Sandvik Asia [supra] on behalf of the assessee was that it was entitled to compensation by way of interest for the delay in payment of the amounts lawfully due to it which were wrongly withheld for a long period of seventeen years. Vide Paragraph (23) of Sandvik Asia [supra], the Division Bench held that, in view of the express provisions of the Act, the assessee was entitled to compensation by way of interest for the delay in payment of the amounts lawfully due to the assessee, which were withheld wrongly by the Revenue. With due respect, section 214 of the Act does not provide for payment of compensation by the Revenue to the assessee in whose favour a refund order has been passed. Moreover, in Sandvik Asia [supra], interest was ordered on the basis of equity. It was also ordered to be paid on the basis of Article 265 of the Constitution. We have serious doubts about the correctness of the judgment in Sandvik Asia [supra]. In our view, the judgment of this Court in the case of Modi Industries Limited vs. Commissioner of Income Tax, 1995 (6) S.C.C. 396 correctly holds that Advance Tax or TDS loses its identity as soon as it is adjusted against the liability created by the Assessment Order and becomes tax paid pursuant to the Assessment Order. If Advance Tax or TDS loses its identity and becomes tax paid on the passing of the Assessment Order, then, is the assessee not entitled to interest under the relevant provisions of the Act?…”
5.1.2 The Court then referred to the relevant provisions of the Act [viz. sections 195, 195A, 214, 243, 244 etc.] and took the view that Sandvik’s case has not been correctly decided and referred the above issue arising in the above case as well as in other appeals to the Hon’ble Chief Justice for decision by a Larger Bench.
Gujarat Flourochemicals – 358 ITR 291 (SC – Larger Bench)
6.1 Based on the view of the Division Bench of the apex court referred to in para 5.1.2, the question of law involved in many cases [which, it seems, included the judgment of the Gujarat High Court in Gujarat Flouro-chemicals Ltd. (supra)] was referred to the Larger Bench (consisting of 3 judges) for consideration and authoritative pronouncement. In the context of the issue to be decided, the Court noted as under:
‘The question which arises in this case is, whether interest is payable by the Revenue to the assessee if the aggregate of installments of Advance Tax or TDS paid exceeds the assessed tax?’
6.2: Referring to the judgment in Sandvik’s case, the Court stated as under:
“We would first throw light on the reasoning and the decision of this Court on the core issue in Sandvik case (supra). The only issue formulated by this Court for its consideration and decision was whether an assessee is entitled to be compensated by the Income-tax Department for the delay in paying interest on the refunded amount admittedly due to the assessee. This Court in the facts of the said case had noticed that there was delay of various periods, ranging from 12 to 17 years, in such payment by the Revenue. This Court had further referred to the several decisions which were brought to its notice and also referred to the relevant provisions of the Act which provide for refunds to be made by the Revenue when a superior forum directs refund of certain amounts to an assessee while disposing of an appeal, revision etc.
Since there was an inordinate delay on the part of the Revenue in refunding the amount due to the assessee this Court had thought it fit that the assessee should be properly and adequately compensated and therefore in paragraph 51 of the judgment, the Court while compensating the assessee had directed the Revenue to pay a compensation by way of interest for two periods, namely; for the Assessment Years 1977-78, 1978- 79, 1981-82, 1982-83 in a sum of Rs.40,84,906/- and interest @ 9% from 31.03.1986 to 27.03.1998 and in default, to pay the penal interest @ 15% per annum for the aforesaid period.”
6.2.1 The Court then stated that the said judgment has been misquoted and misinterpreted to say that in that case the Court had taken a view that the Revenue is obliged to pay interest on interest in the event of its failure to refund the interest payable within the statutory period.
6.2.2 Finally, explaining the effect of Sandvik’s case, the Court stated as under:
“As we have already noticed, in Sandvik case (supra) this Court was considering the issue whether an assessee who is made to wait for refund of interest for decades be compensated for the great prejudice caused to it due to the delay in its payment after the lapse of statutory period. In the facts of that case, this Court had come to the conclusion that there was an inordinate delay on the part of the Revenue in re-funding certain amount which included the statutory interest and therefore, directed the Revenue to pay compensation for the same not an interest on interest.”
6.3 After explaining the effect of the judgment of Sandvik’s case as above, to decide the question of law referred to it, the Court held as under and referred back all the matters before a Division Bench to consider each case independently and take appropriate decision one way or the other:
“Further it is brought to our notice that the Legislature by the Act No. 4 of 1988 (w.e.f. 01.04.1989) has inserted section 244A to the Act which provides for interest on refunds under various contingencies. We clarify that it is only that interest provided for under the statute which may be claimed by an assessee from the Revenue and no other interest on such statutory interest.”
6.4 From the above decision of the Court, one may get an impression that the Court seems to have taken a view that Sandvik’s case was decided under pre-1989 provisions and from assessment year 1989-90, the interest on refund is payable u/s. 244A. As no reasonings are available in this judgment for the view taken by the Court, there is no clarity on this aspect. However, it would appear that the Larger Bench of the Court has not overruled the judgment in Sandvik’s case. The Larger Bench of the Court also does not seem to have approved the view expressed by the Division Bench (referred to in para 5.1.2) that Sandvik’s case has not been correctly decided. Instead, the Court has explained the view taken in Sandvik’s case and the effect thereof that in that case the Court had directed the Revenue to pay compensation for inordinate delay in refunding certain amount due to the assessee which included statutory interest and in that case, the Court had not decided that the Revenue is liable to pay interest on interest.
Conclusion
7.1 From the judgment of three judge Bench of the Apex Court (Larger Bench) in the above case, it becomes clear that the assessee can claim only that interest which is provided under the Act and no other interest can be claimed by the assessee on statutory interest for delay in payment thereof. The similar approach was adopted by the three judge Bench of the Apex Court in the case of Panchanatham Chettiar [99 ITR 579]. As such, the assessee is not entitled to claim interest on interest unless there is a provision in the Act for the same.
7.1.1 It is unfortunate that Larger Bench of the Apex Court has taken such a strict technical view of the issue which, in many cases, may involve the issue of equity and justice. In fact, with this judgment, some Revenue Officials may be tempted to delay payment of interest as that does not create any liability to pay further interest on the amount of interest wrongly withheld. This may happen in cases involving large amount of interest in this era of unjustified pressure for meeting unrealistic revenue collection targets. This possibility was noted by the Apex Court in Sandvik’s case referred to in para 2.13.1 of Part 1 of this write-up wherein the Court has also opined that such actions and consequences seriously affect the administration of justice and the rule of law. It appears that this was also one of the factors considered by the Court to decide the issue in favour of the assessee in Sandvik’s case. Similar approach is found in the judgment of the Delhi High Court in the case of India Trade Promotion Organisation referred to in para 3.1.3.3. Otherwise also, this position may be open to abuse and that is not in the long term interest of fair administration of tax laws. Somehow, the Larger Bench of the Court in the above case has not appreciated this ground reality. To be fair to the assessee, appropriate provision should be made in the Act itself to compensate the assessee in cases of delay in payment of interest due to the assessee. We only hope that the Revenue Officials will strictly follow the directions contained in the Instruction No. 2 dated 28th March, 2007 (referred to in para 3.1.1) issued by the CBDT after the judgment of the apex court in Sandvik’s case.
7.2 From the above judgment, it seems to us that the Larger Bench in the above case has not decided that the assessee will not be entitled to claim compensation from the Revenue even if there is inordinate delay in payment of amount due to the assessee which may include statutory interest. As mentioned in para 6.4, in the above case, the Court has not held that Sandvik’s case was wrongly decided. As such, as held in Sandvik’s case, in case of delay in payment of ‘amount due’ to the assessee it may be possible for the assessee to claim compensation on such amount even if such amount includes statutory interest. Such a claim of the assessee should not be regarded as claim of interest on interest. It also appears that the claim for such compensation may be considered by the Courts and, as held by the Tribunal (TM) in the case of Nirma Chemicals (referred to in para 3.1.2), such a claim may not be entertained by the Tribunal or the lower authorities.
7.3 In the above context, it is worth noting that as mentioned in para 3.1.3.2, the Apex Court in the case of H.E.G. Ltd has held that the words ‘amount due’ appearing in section 244A include interest and the interest com-ponent will partake of the character of the ‘amount due’ u/s. 244A. It seems that this position is not disturbed by the judgment of the Larger Bench in the above case as this has not been considered in the above case. This was also not the issue before the Larger Bench in the above case. It is also worth noting that the judgment of the apex court in H.E.G Ltd was also delivered by a three judge Bench of the apex court. With this position, the claim of interest u/s. 244A on the interest component of the ‘amount due’ may be regarded as claim of interest on shortfall in payment of ‘amount due’ and not as claim of interest on interest. As such, such a claim may be regarded as the claim under the provisions of the Act. This needs consideration even after the judgment of the Larger Bench in the above case. In this context, the judgment of the Delhi High Court in the case of India Trade Promotion Organisation ( supra) is worth noting. At the same time, in this context, the view expressed by the Tribunal (TM) in the case of Nirma Chemicals (supra) may also be borne in mind.
7.4 In the cases of D. J. Works [195 ITR 227] and Chimanbhai S. Patel [210 ITR 419], the Gujarat High Court had taken a view that the assessee is entitled to interest on interest. As mentioned in para 1.4.1 of Part 1 of this write- up, the judgment of the Gujarat High Court was followed by the M. P. High Court in the case of Narendra Doshi and the judgment of the M. P. High Court in the case of Narendra Doshi has been affirmed by the apex court [254 ITR 606]. This is also relied on in Sandvik’s case to take a view that even if there is no provision in the Act for payment of compensation, the compensation for delay is required to be paid. In Sandvik’s case, as mentioned in para 2.9 of Part 1 of this write-up, a view was also taken that the decision of the apex court in Narendra Doshi’s case is on the merits of the matter, though it proceeded on the assumption that there was no provision in the Act grating interest on unpaid interest. Even this judgment in the case of Narendra Doshi was delivered by a three judge Bench of the Apex Court. It is worth noting that this judgment has also not been considered by the Larger Bench in the above case. The implication of this factual position may need consideration and we will have to wait and watch for the position which may ultimately emerge from this situation.
7.4.1 When the Division Bench of the apex court finally decides the issue on merit in the case of Gujarat Flourochemicals [or in any other case from the set of appeals forming part of the judgment of the Larger Bench in the above case], some light may be thrown on the above. Let us hope for the development/ clarity in this regard at that stage.
