Income-tax Act,1961
Act No : 43
Section :
Interest payable by Government 2.
214. Interest payable by Government2 3(1) The Central Government shall pay simple interest at 4[fifteen] per cent per annum on the amount by which the aggregate sum of any instalments of advance tax paid during any financial year in which they are payable under sections 207 to 213 exceeds the amount of the 5[assessed tax] from the 1st day of April, next following the said financial year to the date of the regular assessment for the assessment year immediately following the said financial year, and where any such instalment is paid after the expiry of the financial year during which it is payable by reason of the provisions of section 213, interest as aforesaid shall also be payable on that instalment from the date of its payment to the date of regular assessment: 6 [Provided that in respect of any amount refunded on a provisional assessment under section 141A, no interest shall be paid for any period after the date of such provisional assessment.] ---------------------------------------------------------------------- 1 Prior to the omission, section 213, as amended by the Finance Act, 1965, w.e.f. 1-4-1965; Taxation Laws (Amendment) Act, 1967, w.e.f. 1-10-1967; Finance Act, 1969, w.e.f. 1-4-1969; Finance Act, 1972, w.e.f. 1-4-1972 and the Taxation Laws (Amendment) Act, 1984, w.e.f. 1-10-1984, read as under: "213 Commission receipts.-Where part of the income subject to advance tax consists of any income of the nature of commission which is receivable periodically and is not received or adjusted by the payer in the assessee's account before any of the instalments of advance tax become due, he may defer payment of advance tax on that part of his income to the date on which such income would be normally received or adjusted, and, if he does so, he shall communicate to the Income-tax Officer the date to which such payment is deferred: Provided that, if the advance tax of which the payment is deferred is not paid within fifteen days of the date on which such income or part thereof is received or adjusted by the payer in the assessee's account, the advance tax shall be payable with fifteen per cent simple interest per annum from the date of such receipt or adjustment to the date of payment of the advance tax." 4 Substituted for 'twelve' by the Taxation Laws (Amendment) Act, 1984, w.e.f. 1-10-1984. Section 84 of the Amendment Act has clarified that the increase in the rate of interest will apply in respect of any period falling after 30-9-1984, also in those cases where the interest became chargeable or payable from an earlier date. Earlier, "twelve" was substituted for "nine" by the Finance Act, 1972, w.e.f. 1-4-1972 which was substituted for "six" by the Taxation Laws (Amendment) Act, 1967, w.e.f. 1-10-1967. 5 Substituted for "tax determined on regular assessment" by the Taxation Laws (Amendment) Act, 1984, w.e.f. 1-4-1985. 6 Inserted by the Finance Act, 1968, w.e.f. 1-4-1968. ----------------------------------------------------------------------- 1.659 1[(1A) Where as a result of an order under section 147 or section 154 or section 155 or section 250 or section 254 or section 260 or section 262 or section 263 or section 264 2[or an order of the Settlement Commission under sub-section (4) of section 245D], the amount on which interest was payable under sub-section (1) has been increased or reduced, as the case may be, the interest shall be increased or reduced accordingly, and in a case where the interest is reduced, the 3[Assessing] Officer shall serve on the assessee, a notice of demand in the prescribed form specifying the amount of the excess interest payable and requiring him to pay such amount; and such notice of demand shall be deemed to be a notice under section 156 and the provisions of this Act shall apply accordingly.] (2) On any portion of such amount which is refunded under this Chapter, interest shall be payable only up to the date on which the refund was made. 4[ (3) This section and sections 215, 216 and 217 shall not apply in respect of any assessment for the assessment year commencing on the 1st day of April, 1989, or any subsequent assessment year and, in the application of the said sections to the assessment for any earlier assessment year, references therein [except in sub-section (1A) and sub-section (3) of section 215] to the other provisions of this Act shall be construed as references to those provisions as for the time being in force and applicable to the relevant assessment year.] 5[Explanation 1.- In this section, "assessed tax" small have the same meaning as in sub-section (5) of section 215. Explanation 2.-Where, in relation to an assessment year, an assessment is made for the first time under section 147, the assessment so made shall be regarded as a regular assessment for the purposes of this section.] 1 Substituted by the Taxation Laws (Amendment) Act, 1984, w.e.f. 1- 4-1985. Prior to the substitution, sub-section (]A), as inserted by the Finance Act, 1968, w.e.f. 1-4-1968, read as under: "(]A) Where on completion of the regular assessment the amount on which interest was paid under sub-section (1) has been reduced, the interest shall be reduced accordingly and the excess, if any, paid shall be deemed to be tax payable by the assessee and the provisions of this Act shall apply accordingly." 2 Inserted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989. 3 Substituted for "Income-tax" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. 4 Inserted, ibid, w.e.f. 1-4-1989. 5 Inserted by the Taxation Laws (Amendment) Act, 1984, w.e.f. 1-4- 1985. ----------------------------------------------------------------------- 1.660
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