Interest on late deposit of tds

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Priti Jain (Querist)

17 October 2012 My query is:
Mr. X has deducted the TDS but deposited late on which he calculated interest @1.5% for the period of default. However due to some reason he paid partial interest instead of whole & filed the return.
Question is whether he has to pay interest on unpaid interest or only the unpaid portion of interest? What will be the solution?
Please reply asap...

Amol S Joglekar

Amol S Joglekar (Expert)

17 October 2012 Think from Department's view point and the answer is easy. Partial payment means DEFAULT is continued till today. Calculate in the interest at 1.5% per month till oct 2012. Deduct the amount already paid. Pay the balance amount till 31/10/2012.

Priti Jain

Priti Jain (Querist)

17 October 2012 ok understood..
if payment is to be made on 7th Oct & payment is made on 15th oct so interest will be taken for 1 month only, right? & suppose if interest comes to Rs. 100/- but paid only Rs 80 so balance Rs. 20 can be paid without interest or No before 31st Oct?

Amol S Joglekar

Amol S Joglekar (Expert)

17 October 2012 If the same is paid in OCT. INR20 is correct. If the same is to be paid in NOV, then you need to pay 120

Priti Jain

Priti Jain (Querist)

17 October 2012 ok thanks...

Priti Jain

Priti Jain (Querist)

17 October 2012 Consider this case below:
TDS to be deposited on 7th Sep
But deposited on 28th Sep
Interest calculated on above @1.5% for 1 month
For eg. interest comes to Rs. 500/-
Deposited on 28th Sep - TDS amount + Interest of Rs. 350/- instead of Rs. 500/-
balance Rs. 150/- to be paid today (i.e. 17th Oct 2012)
What will be the amount of payment? Rs. 150/- or different?
This can be treated as incorrect calculation of interest amount
Please reply soon...

Amol S Joglekar

Amol S Joglekar (Expert)

17 October 2012 TDS to be deposited on 7/9/2012. Not deposited till 17/10/2012. so interest is 500 X 2 months i.e. inr 1000. Pay 650 anytime before 31/10/2012 by another challan. (Once again request you to put into the shoes of ITO)

Priti Jain

Priti Jain (Querist)

17 October 2012 But here the TDS is already deposited on 28/09/2012 alongwith interest of 350Rs. default is only with respect to the short payment of interest on TDS. Had the TDS amount not deposited then Rs. 1000 was valid.

Amol S Joglekar

Amol S Joglekar (Expert)

17 October 2012 Please do not think in the manner of "cut miti" rate of interest as is done by our beloved community from Marwar. This is a 2 state affair. Default continues or not? If yes... charge the interest till the completion of default. Please do not confuse the "payment by installment" basis

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