Interest u/s 234A ?

This query is : Resolved

CA Pradeep Gupta (Querist)
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21 July 2009 if an individual assessee has paid self assessment tax before 31st july and files the return on 15 october same year,then will it attract any interest under sec 234A considering the fact that the whole of tax has been paid.Tax liability is RS.4500.
Please give the reason in support of your answer.

Abhishek Mohta

Abhishek Mohta (Expert)
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21 July 2009 As the assessee in your case is an individual assessee he was supposed to file return before 31st July of the assessment year. In case he fails to do so interest U/s 234A is attracted. The rate of interest is simple interest at the rate of 1% per month for the period of default as in this case for the period 31st July till 15th October.

As per section 234B if the taxes payable is greater than taxes paid before 31st March of the previous year by more than 10% i.e. less than 90% of the taxes has been paid then interest U/s 234B shall be attracted @ 1% per month for the number of days the amount was not paid.

Again sec 234C will also be attracted if the quarterly payment of the advance tax is not fulfilled by the assessee.