Interest u/s 234 B/C is payable in MAT?

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CA. Bishwanath Prasad (Querist)
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29 August 2009 Sir,
My client is required to pay MAT u/s 80C
but he has not deposited Advance tax as per income tax rules.
Whether he is liable to pay interest u/s 234 B/C.

With Regards
Bishwanath Prasad
(C.A.(Final)

CA Vanesh Nadar

CA Vanesh Nadar (Expert)
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29 August 2009 yes as 234B/C is for non-payment of Taxes wheather by way of MAT or not.

CP Ram

CP Ram (Expert)
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29 August 2009 Yes interest u/s 234B & 234C is applicable to MAT.
For your info MAT is payable u/s 115JB & not u/s 80C.

Levy of interest u/s 234B and 234C with reference to tax on book profit

The CBDT vide circular no.13 of 2001 dated 09-11-2001 has clarified that the provisions of sec. 115JB is a self-contained code. Sub-section (5) specifies, â€œSave as otherwise provided in this section, all the other provisions of this Act shall apply to every assessee, being a company mentioned in that sectionâ€. Accordingly, interest u/s 234B for default in payment of advance tax and interest u/s 234C for any deferment of advance tax shall be levied in respect of tax computed u/s 115JB also. The levy of interest u/s 234B and 234C on MAT payable was upheld by the Madras High Court in CIT Vs. Geetha Ramakrishna Mills P. Ltd (2006).

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Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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29 August 2009 Yes interest provision is applicable to MAT also.

Citation :- Madras Pharmaceuticals (p) Ltd Vs. DyCIT (2008) 24 SOT 180 (Mum-Tri).

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