14 June 2014
If a person having NSC of 2500000 and interest on NSC is say 200000 every year and other deduction under 80 c is more than 100000, then all the interest shall be taxable. Now at the time of maturity what value shall be taxable ? If whole interest is taxable it lead to double taxation.
15 June 2014
The interest for last year is taxable as it is not reinvested. and as you mentioned the interest for previous years has been taxed earlier. so it will be not taxed again.
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