Are You Charged With Illegal Interest u/s 234A ?


The interest payable under section 234A income tax act is payable for delay in filing of tax return. The scheme of charging interest under section 234A of the Income Tax Atc is that if an assessee pays advance tax on or before 31st of March, interest u/s.234A is not levied, whereas if the tax is paid on or after 1st April by way of Self-Assessment, the interest u/s.234A is attracted if the return is filed after due date of filing return u/s 139(1) of the Income Tax Act. However, it has been settled now that interest  u/s.234A is compensatory in nature and should be levied only in case, the taxpayer does not pay all its tax liability before the due date for filing of tax return u/s 139(1).

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