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interest due to sec234b & and 234c

Anurag Kumar (Service) (62 Points)

13 July 2009

I'm a salaried individual and am paying income tax regularly via TDS thru salary. However I had other income due to interest received via S/B account and FD's. Now I find due to this there is shortfall of tax paid in the last FY. As per the calculation I have paid 91% of applicable tax already thru TDS by Mar'09. Kindly let me know if sec 234B and C are applicable to me or I can pay the balance 9% without any penalty

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5 Replies

Kailash Sharma (CA- Final Student) (148 Points)
Replied 13 July 2009

Hi Anurag Kumar

As per ur current situation i think sec 234(C)(1)(b) is applicable to u so u have to pay interest accordingly

if u have any Singhania Book or T.Manoharan u can refer this section in that book.

Sec 234 C is applicable when u have not paid 100% Advance Tax of the Tax Amt assessed.

In This Case u have to go for Reverse calculation & Charge 1% interst Per month on the Balance Amt coming after working & also Sec 234B applies only when u have not paid Adv tax up to 90% so itz clear SEC 234 C Applies to u.

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(Guest)

Hi Anurag,

Since you have paid 91% as tax by 31st March so sec 234B shall not be applicable as it is only applicable if tax paid is below 90%. Furthur if any amount paid on or before 31st Mar, 09 will be included as advance tax paid within due date.

U/s 234C interest to be paid if tax paid falls short of 100% within 15th march, 09 @ 1% on the amount of short fall. So assuming you paid 91% of tax within 15th Mar, 09 so you have to pay interest @ 1% on the amount of shortfall(i.e. on 9%).

Anurag Kumar (Service) (62 Points)
Replied 13 July 2009

Dear Tinku/kailash, Thanx for the response.. However to make things more clear pls find details as under: (1)TDS from accrued interest from FD's has been deducted on 31Mar and reflected in my Form 16A with the remarks that same will be deposited in accordance with Rule30 of IT rules 1962. Since the form 16A has been received only in May and it is based on accrued interest only (payout has still not taken place)I had little idea of the tax I would be incurring out of accruals in last FY. (2) similary the last TDS from salary is also credited to Govt by employer on 6apr. The applicability of Sec 234B/C is required in such scenario.

shashikumar vn (Manager) (22 Points)
Replied 25 July 2009

Originally posted by :Shashikumar
"	I'm a salaried individual and am paying income tax regularly via TDS thru salary. However I had other income from Rent received by letting out the flat which i own,though this information given to the employer this value was not taken for the incometax caluculation and TDS made only on the salary,while filing up the ITR2 understood that the tax due is Rs 3,916.00,which is 26% of the total tax.Now i would like to know,can I pay this balance amount tax,if yes what will be the interest and penalty i have to pay over and above the tax due	"