Applicability of 234b & 234c interest
This query is : Resolved
15 June 2016
One of our assessee client is senior citizen having no income from business and profession but
having exempted share of profit of firm as partner u/s 10(2A) of the Income Tax Act, 1961 and He
filed his e return of income under ITR3 for Assessment Year 201314 claiming benefit of section
207(2) of Income tax act i.e. liability of advance tax does not arise in such case and consequently
interest u/s 234B & 234 C for nonpayment of advance tax does not arise
However, Client has received Assessment order u/s 143(1) from CPC Bangalore in which
interest u/s 234B &234C for nonpayment of advance tax have been levied
Kindly let us know whether exempted share of profit from firm in the hands of partner is business
income for the purpose of section 207(2) of the income tax act or not ? However, Assessee has
considered such share of profit is not a business income and claimed benefit of 207(2). If
assesses’ contention is correct then CPC is wrong to levy such interest. Assessee contention is
based on premise that exempted share of profit under section 10(2A) does not fall as income
from business and profession u/s 28 of the act
We are eager to know the factual position whether assesses is correct or assessing authority is
correct ? This matter has been brought to us for our opinion
Thanks & Regards
having exempted share of profit of firm as partner u/s 10(2A) of the Income Tax Act, 1961 and He
filed his e return of income under ITR3 for Assessment Year 201314 claiming benefit of section
207(2) of Income tax act i.e. liability of advance tax does not arise in such case and consequently
interest u/s 234B & 234 C for nonpayment of advance tax does not arise
However, Client has received Assessment order u/s 143(1) from CPC Bangalore in which
interest u/s 234B &234C for nonpayment of advance tax have been levied
Kindly let us know whether exempted share of profit from firm in the hands of partner is business
income for the purpose of section 207(2) of the income tax act or not ? However, Assessee has
considered such share of profit is not a business income and claimed benefit of 207(2). If
assesses’ contention is correct then CPC is wrong to levy such interest. Assessee contention is
based on premise that exempted share of profit under section 10(2A) does not fall as income
from business and profession u/s 28 of the act
We are eager to know the factual position whether assesses is correct or assessing authority is
correct ? This matter has been brought to us for our opinion
Thanks & Regards
15 June 2016
Hello Sheshu,
How can the department levy advance tax when the asesses income is NIL,
Please refer to the communication u/s 143(1), where the department cleary mention the difference between your income and the income assesed by the department
How can the department levy advance tax when the asesses income is NIL,
Please refer to the communication u/s 143(1), where the department cleary mention the difference between your income and the income assesed by the department
16 June 2016
Dear Saurabh,
Assessee has other income other than share of profit from firm.
Assessee has other income other than share of profit from firm.
16 June 2016
Hello Sheshu,
The following exempt income cannot be taken as Bussines Income.
Please check the order u/s 143(1) that whether the department has included the same in the business income.
The following exempt income cannot be taken as Bussines Income.
Please check the order u/s 143(1) that whether the department has included the same in the business income.
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