C.N.Ramachandran Nair, J.

Of the two questions raised in the appeal filed by the revenue against the orders of the Tribunal disposing of the assessment appeal relating to the respondent for the assessment year 1998-1999, the first issue is whether the department is entitled to collect interest under Section 234D of the Income Tax Act. This issue stands decided by our decision reported in CIT vs. Kerala Chemicals & Proteins [323 ITR 584], wherein we have held the interest is payable only from the date of introduction of the provision, that is, 1.6.2003.

2. The next question raised is with regard to the date with reference to which the assessee is entitled to interest under Section 244A of the Income Tax Act on the refund paid to it. The assessing officer declined interest because the refund is attributable to an additional claim of deduction of provision for bad debt which was allowed by the first appellate authority. However, in appeal, the first appellate authority held that assessee is entitled to interest under Section 244A from 10.1.2001 and not from 1.4.1999 as claimed by the assessee in terms of Section 244A(1)(a) of the Act. The reason behind limiting the interest