INTEREST U/S 234C

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CA Mohit Garg (Querist)
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06 August 2009 IN CASE OF ASSESSE OTHER TAN COMPANY, HAS TO DEPOSIT 30% ADVANCE TAX UPTO 15TH SEP, OTHERWISE INTEREST @ 1% PER MONTH WILL BE CHARGED UNDER SEC 234C, IF 30% ADVANCE TAX IS DEPOSTED BY ASSESSE ON 20TH SEP THAN INTEREST WILL BE CHARGED FOR 1 MONTH OR 3 MONTH. IS HE WILL GET ANY BENIFIT FOR DEPOSITING TAX BEFORE NEXT INSTALMENT I.E. 15TH DEC

J.KARTHICK

J.KARTHICK (Expert)
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08 August 2009 Hi Mohit

Your question is correct but as per IT act , the advance tax paid by the assessee on his current income before 15th sep is less than 30% of the income tax on the returned income "he is liable to pay simple interest @ 1% for a period of 3 months" on the difference between 30% and the advance tax paid . THE PERIOD CONSIDERED FOR THE INTEREST IS THE NUMBER OF MONTHS BETWEEN 15 th SEP & 15 th DEC ,i.e 3 months , so that assessee cannot claim any benefit eventhough he has paid on 16th SEP.