Interest on Tax

This query is : Resolved

Devendra (Querist)
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24 November 2010 Mr. X a salaried assessee has filed his return on 20/11/2010. His Total Taxable income was Rs. 742982/-. And tax payable by him is Rs. 130700/- and TDS is deducted Rs. 155444/-. Thus he is getting a refund of Rs. 24840/-. Will the refund reduce due to Interest levied u/s 234A, 234B or 234C?

Regards,
Devendra P Kulkarni

CA. BHAVIK DILIPBHAI MEHTA

CA. BHAVIK DILIPBHAI MEHTA (Expert)
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24 November 2010 Interest u/s. 234A,234B or 234C is levied only when there is liability of pay advance tax & advance tax payable only when the assessed tax after deduction of TDS is more than Rs. 5,000/-. In your case the TDS amount is more than tax payable hence the question of advance tax payment does not arise. Hence no interest will be levied u/s. 234A,234B or 234C. On the contrary your client is entitled to interest u/s. 244A @ 0.50% per month.

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CA.Madhusudan B.P.

CA.Madhusudan B.P. (Expert)
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24 November 2010 Devendra,

The provisons of Sec 234A/B/C shall not apply in your case, as your employer has already deducted month on month & paid the taxespn behalf of you, so interest shall not be levied on you.
As Mr.Bhavik said you are entitled for interest on your refund from the Income tax department.

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