Interest u/s 243a

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Querist : Anonymous

Querist : Anonymous (Querist)

07 August 2013 If the self assessment tax is paid duly before the due date for filing the income tax return and if the return is filed belated u/s 139(4) can interest u/s 234A be charged by the income tax deptt. And if so how to pay it? Through chalan or do we need to file any particular form with the IT deptt.?

Thanks

CA Prashant Gupta

CA Prashant Gupta (Expert)
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07 August 2013 if you have paid full tax by self assessment tax u/s 140A then there will be no interest
CIT v. Dr Prannoy Roy (2009)179 Taxman 53 (SC).

BUT if you still need to pay tax then you will be charged interest. no deduction of tax paid u/s 140A will be allowed as section don't allow this.

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Querist : Anonymous

Querist : Anonymous (Querist)

14 August 2013 Thank you very much sir for your advise. But if the notice is sent by the Department for payment of interest u/s 234A how to deal with it? Is there any particular or prescribed form for the same to reply?

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Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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01 August 2024 ### **Interest Under Section 234A**

#### **Applicability of Interest Under Section 234A**

1. **Interest for Belated Return Filing:**
- **Section 234A** charges interest for filing a return after the due date. This interest is applicable even if the self-assessment tax is paid before the due date of filing the return. The logic is that interest under Section 234A is for the delay in filing the return, not for the delay in payment of taxes.

2. **Self-Assessment Tax Paid Before Due Date:**
- If you have paid the self-assessment tax before the due date of the return but file the return belatedly under Section 139(4), interest under Section 234A can still be charged.

#### **Calculation and Payment of Interest**

1. **Calculation of Interest:**
- The interest under Section 234A is calculated from the due date of the return until the date of actual filing of the return. The rate of interest is 1% per month or part of the month.

2. **Payment of Interest:**
- The interest payable under Section 234A can be paid using Challan No. 280 through the online payment system on the Income Tax Department's e-filing portal or at designated banks.

#### **Responding to a Notice for Interest Under Section 234A**

1. **Notice from the Department:**
- If you receive a notice from the Income Tax Department demanding payment of interest under Section 234A, it generally means that the department has calculated the interest due to the belated filing of the return.

2. **How to Pay:**
- You should pay the interest amount through Challan No. 280. Make sure to select the appropriate head for the payment (i.e., “Self Assessment Tax” or “Advance Tax” as applicable) and include the relevant details such as PAN, assessment year, and type of tax.

3. **Filing Response:**
- There is no specific form to reply to the notice for interest under Section 234A. However, once you make the payment, you should ensure that you:
- Update the details of the payment in your tax records.
- If required, provide evidence of payment in response to the notice.
- Attach a copy of the Challan and a brief explanation in your response to the notice.

#### **Steps to Follow:**

1. **Calculate the Amount:**
- Determine the interest amount for the delay period as per Section 234A.

2. **Pay the Interest:**
- Pay the calculated interest amount using Challan No. 280 online or at the bank.

3. **Keep Records:**
- Retain a copy of the payment receipt and Challan for your records.

4. **Respond to Notice:**
- If you receive a notice, provide proof of payment along with a brief explanation, if required, to the Income Tax Department.

For precise calculations and handling specific cases, consulting a tax professional or accountant might be beneficial to ensure compliance and correct handling of tax matters.