Tax reporting for multi year fd

Hi,

My father has deposited 20 Lak for 3 years in SriRamChits ( Private chit fund company ) which gets matured in the 3rd year . The deposit is made during the F.Y 2016-2017. 
There is no entry in his FORM 26AS but as a responsible citizen he disclosed the details to the tax consultant.
During the Tax returns the tax consultant has made him pay tax on the earned interest my manually computing it even though my father hasn’t received any interest amount that year. Is it a right thing to do ? In general how to handle these kind of multi-year FD where the interest will be paid on the maturity year. Should he report this FD in every year filling and pay the tax in advance?

Replies (3)
interest or loss could be calculated only at the time of maturity.... in case of subscripttion made in chits
in if it's chit contribution but if it's FD, then even if you realise the interest amount at the time of maturity, the per annum interest should be computed on accrual basis

Thank you Rama Krishnan for the quick reply.  Even though its a CHIT fund company they offer FD's as well and my father has invested in it. If I understand your response correctly, we can report the interest distributed in all the 3 years. Is that a correct understanding.

yes... interest accrued should be computed separately for each year

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