Any taxpayer who had furnished the taxes and has not to furnish his or her ITR till the mentioned date specified u/s 139(1) is liable to pay interest u/s 234A.
Last Date of Section 139(1)
- Non Audit Cases: 31st July
- Audit Cases: 31st Oct,
Because of covid-19 CBDT dated May 20th, 2021has prolonged the last date for furnishing the ITR up to 30th Sep 2021 (Non-Audit Cases) and 30th Nov 2021(Audit Cases) wide Circular No. 9 of 2021 Dated 20th May 2021 or Order [F.No.225/49/2021-ITA-II].
Tax Payable = Tax On Total Income-TDS & Relief under section 89/90/90A
Thus it is clear under the section 234A with 139(1), a taxpayer is subject to furnish the interest u/s 234A if:
- He is liable to furnish the tax
- He does not furnish the ITR up to 30th Sep 2021(Non-Audit Case) or 30th Nov 2021(Audit Cases)
According to Circular No. 9 of 2021 Dated 20th May 2021 or Order [F.No.225/49/2021-ITA-II] if the tax paid by the taxpayer is more than Rs 1,00,000 then for the intention of the section 234A due date extension is not applicable on him and Interest will be charged from 1st Aug 2021(Non-Audit Cases) or 1st Dec 2021(Audit Cases) according to the case might be but he can furnish the return up to Sept 30th, 2021 and Nov 30th, 2021 according to the case.
Note: the interest shall be charged up to date of furnishing of the return.
Note: If the taxpayer pays all the outstanding tax demand post to the last date but do not furnish the return:
- In this scenario, the taxpayer shall be entitled to furnish the interest u/s 234A on tax payable till the date of filing the return.
Let’s See the Same from the Illustrations:
- Tax On Total Income = 241021
- Relief U/s 89/90/90A = 15000
- TDS = 25000
- Date Of Filing of Return = 02/08/2021
- INTEREST U/S 234A:
- Amount on which interest to be calculated: 241021-15000-25000 = 201021
- Period 1st August 2021 to 2nd August 2021 i.e. 1 month
Conclusion for Point 2: As the tax filing is Rs 2,01,021 which exceeds Rs 1,00,000 so according to Circular No. 9 of 2021 on 20th May 2021 the last date for computing the interest U/s 234A shall be 31st July so in the same case the interest charged shall from the subsequent day of the original last date that is from 1st August 2021.
- The tax on the total income = 241021
- Relief U/s 89/90/90A = 15000
- TDS = 25000
- Date Of Filing of Return = 02/08/2021
- Self-Assessment Tax Paid On 01st Aug 2021 = 203027
- INTEREST U/S 234A:
- Amount on which interest to be calculated: 241021-15000-25000 = 201021
- Period 1ST Aug 2021 To 2nd Aug 2021 i.e. 1 month
The tax furnished post to the last date is not acknowledged for the intention of computing the interest u/s 234A
Conclusion for Point 3: As the tax furnished is Rs 201021 is more than Rs 100000 thus according to Circular No. 9 of 2021 on 20th May 2021 the last date for computing the interest u/s 234A shall be July 31st. Hence it is in the case interest shall be charged from the subsequent day of the original last date that is from the 1st Aug 2021.
Conclusion
| CASE I: Tax payable does exceed INR 100000 | CASE II: Tax Payable does exceed INR 100000 |
| Interest will be charged Form 1st Oct 2021 or 1st Dec 2021 as the case Maybe to date of return filing | Interest will be charged Form 1ST August 2021 or 1st November 2021 as the case Maybe to date of return filing |
Live Webinar on I-T Section 234A by CA Pradeep
The SAG Infotech brings the latest section 234A webinar for all the concerned professionals wanting to know more about this newly introduced section by the tax department. The company will be registering all the professionals through Google form and would further send them Google meet links. The webinar will be hosted by an experienced CA Pradeep Kumawat. We request you to register for this webinar and get facilitated by the services. The webinar date is 14th August 2021(Saturday) | Time: 11 AM to 12 PM
