Appeal was filed against the order of CIT(A) on the ground that adjustment of part income tax refund received by assessee against the total outstanding refund which comprises tax as well as interest is incorrect. The plea was that first the refund needs to be adjusted against the interest element and then the balance towards the principal amount of refund. The tribunal allowed the ground of the assessee by relying on the decision in case of Union Bank of India v ITO [72 taxmann.com 348 (Mumbai)] and on Delhi High Court in the case of India Trade Promotion Organisation v. CIT [2014] 361 ITR 646 (Delhi) where it was held that that there is no provision in law for manner of adjustment of part refund granted. And taking into account the provisions of section 140A requiring self-assessment tax paid short by the assessee to be first adjusted against interest outstanding and then against tax, and also the provisions of section 220 charging interest on the portion of outstanding demand of tax including interest, the Court held that the same principle would follow if revenue defaults in full payment of refund. Since section 244A debars payment of interest on interest refund, it held that part refund needs to be adjusted against interest first otherwise the AO would refund the principal amount and not pay the interest component under section 244A for an unlimited period with impunity and without any sanction which would tantamount to allowing a premium on non-compliance with the law (AY.1993-94 & 1998-99)