234B and 234C applicability....

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Rajesh (Querist)
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30 September 2010 Dear Experts,
Pls. tell me 234B and 234C of income tax act applies only when the tax payable exceeds Rs.10000. In other words if the tax liability after deducting TDS is less than Rs. 10000 234B and 234C is not applicable. Am i right?
Thanks for the reply.
With regards,
Rajesh.

CA Shailesh Kumar Bhagat

CA Shailesh Kumar Bhagat (Expert)
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30 September 2010 No you are wrong. If the difference of assessed tax and actual tax payment is more than 10% . Interest will be chargeable. i.e. if the advance tax has been paid less than 90% of assessed tax.

CMA. Subhash Kumar Jha

CMA. Subhash Kumar Jha (Expert)
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30 September 2010 I think.. the question of Mr Rajesh is different.

He is asking about the basic eligibility for advance tax ?

You are right.. if the total tax payable as deducted by TDS, is less than Rs. 10000/-, the advance tax provisions are not applicable & hence interest under 234B / 234C will not apply.

However, as Mr. Shailesh rightly pointed out, if at the time of final assessment the difference of assessed tax and actual tax payment is more than 10% . Interest will be chargeable.

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