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2019 (9) TMI 1239 - HC - Income TaxAdjustment towards interest payable u/s 234B(2)(ii) - filing return of income i.e. when payment of Self-Assessment Tax u/s 140A is required to be made - whether the AO was correct in computing interest on the date of payment of taxes by the assessee and adjusting the amount so paid towards interest? - HELD THAT:- As per section 140A of the Act where any tax is payable on the basis of any return, the assessee shall be liable to pay such tax together with interest and the return is required to be accompanied by proof of payment of such tax and interest. Thus, the computation of interest and liability to pay such interest arises at the time of filing return. The Explanation below this Section 140A of the Act in fact supports the above interpretation. As per this explanation, where the amount paid by the assessee under this section falls short of the aggregate of the tax and interest, the amount so paid shall first be adjusted towards the interest payable and the balance shall be adjusted towards the tax payable. The amount paid here will be the aggregate of the amount paid under this section not the individual amount. This exercise is to be done at the time when the return is being filed so that in case any assessee has not paid the full amount i.e. tax and interest then, the amount paid shall first be adjusted towards interest and liability to pay interest on balance tax shall continue. The judgment delivered in the case of M/s Patson Transforms Ltd. Vs. DCIT [2005 (11) TMI 388 - ITAT AHMEDABAD] relied upon by the CIT (Appeals) and the Tribunal has examined this issue in detail with example. We are in agreement with the conclusion of CIT(Appeals) and the Tribunal based on the above judgment. Question answered in favour of the assessee and against the Revenue.
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