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Interest u/s.234A and late filing fee 234F

30 September 2019

Is interest and late filing fee in subject applicable for the extended due date of ITR covered under tax audit for AY 2019-20?

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8 Replies

Kapadia Pravin (17249 Points)
Replied 30 September 2019

234A is applicable
234F is not applicable

Suresh Thiyagarajan (Student) (3986 Points)
Replied 30 September 2019

1. Interest u/s 234A @ 1% will need to be payable on the Net tax liability payable after deduction of TDS and advance tax.
2. Sec 234F deals with default in filing the ROI. Penalty will be levied based on the filing of return.
3. If you have filed your ROI before the extended due date then both the above sections will not be applicable.
Please correct me if the above solution has an alternative view.

Kapadia Pravin (17249 Points)
Replied 30 September 2019

@ Suresh ji

As per 119 extension of due date notification , there is no extension for 234A interest and hence it's applicable.

Extract from Notification
""
However, there shall be no extension of the due date for purpose of Explanation 1 to section 234A (interest for defaults in furnishing return) of the Act and the assessee shall remain liable for payment of interest as per provisions of section 234A of the Act ""

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Suresh Thiyagarajan (Student) (3986 Points)
Replied 30 September 2019

Yes, I accept. I read the notification.

Kapadia Pravin (17249 Points)
Replied 01 October 2019

👍 👍

sabyasachi mukherjee (26067 Points)
Replied 01 October 2019

Mohan pls note if you hv paid self assesment tax earlier ,return is filed after the due date.
you are not subject to interest under section 234A.
read case law
CIT V pranay ray (2009) 179 in Apex court.

Mohan Kale (342 Points)
Replied 01 October 2019

Sabyasachi sir, isn't it contradictory that one need not pay 234A if tax is paid in time but return filed after due date where as the interest u/s.234A itself is levied for default in filing return as per due date and not for payment of tax? The purpose of levying interest u/s.234A does not get served in such case.

The issue apart as far as I recollect until few years back government never subjected extension to interest u/s.234A but lately it's happening. The point is again why charge interest 234A when the due date itself is extended. In coming future government may subject such extension to fee u/s.234F. And that would be really horrifying.

sabyasachi mukherjee (26067 Points)
Replied 01 October 2019

I understand your contention.
The Sec was introduced long before.
But the case law is a recent one.
The judgement in case laws are being issued with respect to the curcumstances of the case.