18 July 2011
Interest on Refunds [Section 244A] : Rate: 0.5% p.m. or part of a month Amount : tax or penalty becoming refundable on account of excess payment of advance tax, advance tax on fringe benefits, TDS/ TCS and other tax or penalty becoming refundable.
Period for which the interest is payable: - In case refund of any advance tax or TDS/TCS: from 1st April of AY in which return is filed to the date of the grant of refund. - In case refund of other taxes/penalties: from the date of payment of such tax or penalty upto the date on which the refund is granted.
Note: 1. In case refund of any advance tax or TDS/ TCS: No interest shall be payable if the amount of refund due is less than 10% of the tax determined u/s 143(1) or on regular assessment. 2. Where there is a delay in granting refund and the reasons for such delay are attributable to the assessee, either wholly or in part, the period of the delay so attributable to the assessee shall be excluded from the period for which interest is payable. 3. Where as a result of an order passed u/s 115WE(3), 115WF, 115WG, 143(3), 144, 147, 154, 155, 250, 254, 260, 262, 263 or 264 or an order of the Settlement Commission u/s 245D(4), the amount on which interest was payable has been increased or reduced, the interest shall be increased or reduced accordingly 4. Interest allowed u/s.244A is the income of the P.Y. in which it is allowed, and should be declared in the ROI furnished in the A.Y. relevant to the P.Y.
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