Saliq Ansari (CA_Final Student) (885 Points)
07 February 2011A.Y.2008-09, Individual male assessee Return filed on 08/02/2010
Net Taxable Income 2,50,180
Tax Including cess 24,776
Adv Tax paid (06/05/2008) 25,000
In the Above problem is interest u/s 234 A,B &C is applicable or not...
Pankaj Arora
(Learner)
(3134 Points)
Replied 07 February 2011
How did u file your return because time has over for that A.Y. ?
Saliq Ansari
(CA_Final Student)
(885 Points)
Replied 07 February 2011
Dear Pankaj
A belated return could be filed till one year from the end of relevant Assessment year,
in above case A.Y. 2008-09 i.e. last date of filing is 31/03/2010.
CA Nitu Agarwal
(CA, M.Com)
(266 Points)
Replied 07 February 2011
Intt u/s 234A is a penal intt for delay in filing of ROI. Amount of Tax on which such intt is caclculated is
Tax Due - (MAT Credit+TDS/TCS+Advance Tax+Self Assessment Tax paid b'fore due date)
So in present case, no intt will be charged u/s 234A.
Intt u/s 234B is a compensatory intt which is charged when Advance Tax paid is less than 90% of Tax Due. So in present case, as no Advance Tax is paid, intt u/s 234B shall be charged.
Intt u/s 234C is chargeable for defferrement of Advance Tax. As no Advance Tax is paid by Assessee, intt u/s 234C shall be applicable.
Hitesh Agarwal
(Chartered Accountant)
(80 Points)
Replied 07 February 2011
Section 234A applies when the return of income is not filed within the due date u/s 139(1) or within the time allowed by the notice u/s 142(1), or if the return of income is not furnished.
In the present case the due date for filing return of income is 31/07/2009 and the return is filed on 08/02/2010 which is not filed within the due date u/s 139(1) hence interest u/s 234A will be levied. i.e 1% for every month or part of the month. Interest will be charged from due date of filing of return till the date of furnishing the return. i.e interest will be charged from 31/07/2009 to 08/02/2010 . Amount on which interest is payable is tax payable less TDS,TCS and advance tax paid.
Saliq Ansari
(CA_Final Student)
(885 Points)
Replied 07 February 2011
Ms. Nitu Agarwal
Thanks for Sharing your view.
Int u/s 234B & 234C shall be charged when Advance Tax is not paid but in the case above Advance tax is paid Rs.25,000/- on 06/05/2008.
Kindly reply
Hitesh Agarwal
(Chartered Accountant)
(80 Points)
Replied 07 February 2011
Nitu Agarwal
As per the provisions of the act if return is not filed within the due date or not furnished interest u/s 234A will be applicable
Hitesh Agarwal
(Chartered Accountant)
(80 Points)
Replied 07 February 2011
Dear Saliq Ansari
Your a.y is 2008-2009 i.e financial year 2007-2008 so advance tax has to be paid before 31st march 2008 and not after 31st march 2008
Saliq Ansari
(CA_Final Student)
(885 Points)
Replied 07 February 2011
Thanks
Hitesh Agarwal
But in the case above interest u/s 234A will be payable on (tax payable less TDS,TCS and advance tax paid) i.e. 24776-25000 = -224
now will there be interest u/s 234A
Hitesh Agarwal
(Chartered Accountant)
(80 Points)
Replied 07 February 2011
You are correct that interest is payable on amount of tax less tds, tcs and advance tax but advance tax has to be paid before 31st march 2008 and not after 31st march 2008. your financial year is 2007-2008
Saliq Ansari
(CA_Final Student)
(885 Points)
Replied 07 February 2011
Thanks
Hitesh Agarwal
and would interest u/s 234B & 234C will be applicable or not
Hitesh Agarwal
(Chartered Accountant)
(80 Points)
Replied 07 February 2011
Interest u/s 234B is applicable when the assessee fails to pay advance tax or advance tax paid by the assessee is less than 90% of the assessed tax. In the present case no advance tax has been paid so interest will be applicable.
Regarding 234C where the assessee fails to pay any instalment of advance tax or pays less amount than prescribed he will be liable to pay interest u/s 234C. So interest is applicable
Durgesh Joglekar
(Mcom)
(11558 Points)
Replied 07 February 2011
All income tax sections...
in a suitable pdf file for quick revision
nishant rai
(student)
(27 Points)
Replied 07 February 2011
dear saliq,
int under 234B for not paying adv tax will be appl as 24776*1%*2mnths=495.52
int under 234C for defferment in adv tax
1st inst 24776*30%*1%*3mnths=223
2ndinst 24776*60%*1%*3mnths=446
3rdinst 24776*1%*1mnth=247
Hitesh Agarwal
(Chartered Accountant)
(80 Points)
Replied 08 February 2011
Interest u/s 234A is in the nature of compensation and not in the nature of penalty. Hence where the tax as per the returned income is paid before the due date of filing of return on income, no interest u/s 234A leviable, even if return not filed before due date. (CIT Vs Pranoy Roy, 254 ITR 755(Del,), CIT Vs India Meters LTD(2009) 309 ITR 231 (SC). So no interest will be leviable u/s 234A
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