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Interest u/s 234B/C computed by AO

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Jayant Sharma

Student

44 Points Posted on 26 December 2019

in case of scrutiny assessment how AO compute interest u/s 234A/B/C ?(in case of company)

It is more than what we computed earlier(by hand) and also computed by software/utility.

for example.
AY 2017-18, Due date 31.10.2017,
Tax Liability 17832650
TDS 7164225, ADV tax on each period 10L+10L+25L+40L=85L and after 15/3/17 10L. under 140A= 12.60L.

interest u/s 234B by AO = 160984.
order u/s 143(3) 12/12/2019.

Replies (12)

CMA M.Keerthi chandra

C.A FINAL STUDENT AND QUALIFIED C.M.A

325 Points Posted on 26 December 2019

If the A.O has made any additions to the returned Income, then he may simultaneously recompute the 234 B or 234 C interests on the enhanced Income and raise a fresh demand of Notice U/s 156.Computation Sheet shall also be attached with order copy.

Jayant Sharma

Student

44 Points Posted on 26 December 2019

But the computation of such interest is not there. the final amount of interest showing in notice, such as 234B, 234C

CMA M.Keerthi chandra

C.A FINAL STUDENT AND QUALIFIED C.M.A

325 Points Posted on 26 December 2019

Please confirm if there is any addition or not? or else he may have erred.Bring to his Notice.

Jayant Sharma

Student

44 Points Posted on 26 December 2019

Yes there is an addition of rs. 383850,

CMA M.Keerthi chandra

C.A FINAL STUDENT AND QUALIFIED C.M.A

325 Points Posted on 26 December 2019

Then in that case, you have to challenge the addition first (if you feel it is invalid).Interest component is dependent on Tax .

Without questioning the Tax component how could you question its dependent , I mean Interest.Moreover Interest U/s 234 A, B, C is not penal in Nature.Hence it shall be levied.