Is tax rebate Rs 2.5k for 3L or 3.5L -AY 2018-19

Rebate of income-tax in case of certain individuals.

87A. An assessee, being an individual resident in India, whose total income does not exceed [three hundred fifty thousand]  rupees, shall be entitled to a deduction, from the amount of income-tax (as computed before allowing the deductions under this Chapter) on his total income with which he is chargeable for any assessment year, of an amount equal to hundred per cent of such income-tax or an amount of [two thousand and five hundred] rupees, whichever is less.

So for senior citizen.... tax upto 3,50,000/- will not be taxable taking into account the rebate of (maximum) Rs. 2500/- 

Similarly for individual assessee tax upto 3 lakhs becomes nill.......

For your example of 3.40 lakhs tax liability for assessee below 60 yrs. comes to........  Rs. 4,500/- before tax relief..... & Rs. 2,000/- taking relief into account.