Income Tax Act, 2025
Section 8: Ins. by s. 39, ibid (w.e.f. 11989).
8. Ins. by s. 39, ibid (w.e.f. 11989).
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(ii) thereafter, interest shall be calculated at the rate aforesaid on the amount by which the tax so
paid together with the advance tax paid falls short of the assessed tax.
1[(2A) (a) where an application under sub-section (1) of section 245C for any assessment year has
been made, the assessee shall be liable to pay simple interest at the rate of one per cent. for every month
or part of a month comprised in the period commencing on the 1st day of April of such assessment year
and ending on the date of making such application, on the additional amount of income-tax referred to in
that sub-section;
(b) where as a result of an order of the Settlement Commission under sub-section (4) of section 245D
for any assessment year, the amount of total income disclosed in the application under sub-section (1) of
section 245C is increased, the assessee shall be liable to pay simple interest at the rate of one per cent. for
every month or part of a month comprised in the period commencing on the 1st day of April of such
assessment year and ending on the date of such order, on the amount by which the tax on the total income
determined on the basis of such order exceeds the tax on the total income disclosed in the application
filed under sub-section (1) of section 245C;
(c) where, as a result of an order under sub-section (6B) of section 245D, the amount on which
interest was payable under clause (b) has been increased or reduced, as the case may be, the interest shall
be increased or reduced accordingly;]
2[(3) where, as a result of an order of reassessment or recomputation under section 147 or
section 153A, the amount on which interest was payable in respect of shortfall in payment of advance tax
for any financial year under sub-section (1) is increased, the assessee shall be liable to pay simple interest
at the rate of one per cent. for every month or part of a month comprised in the period commencing on the
1st day of April next following such financial year and ending on the date of the reassessment or
recomputation under section 147 or section 153A, on the amount by which the tax on the total income
determined on the basis of the reassessment or recomputation exceeds the tax on the total income
determined under sub-section (1) of section 143 or on the basis of the regular assessment as referred to in
sub-section (1), as the case may be;]
(4) where, as a result of an order under section 154 or section 155 or section 250 or section 254 or
section 260 or section 262 or section 263 or section 264 3***, the amount on which interest was payable
under sub-section (1) or sub-section (3) has been increased or reduced, as the case may be, the interest
shall be increased or reduced accordingly, and—
(i) in a case where the interest is increased, the Assessing Officer shall serve on the assessee a
notice of demand in the prescribed form specifying the sum payable and such notice of demand shall
be deemed to be a notice under section 156 and the provisions of this Act shall apply accordingly;
(ii) in a case where the interest is reduced, the excess interest paid, if any, shall be refunded;
(5) the provisions of this section shall apply in respect of assessments for the assessment year
commencing on the 1st day of April, 1989 and subsequent assessment years.]
thereafter, interest shall be calculated at the rate aforesaid on the amount by which the tax so
paid together with the advance tax paid falls short of the assessed tax.
1[
(a) where an application under sub-section
of section 245C for any assessment year has
been made, the assessee shall be liable to pay simple interest at the rate of one per cent. for every month
or part of a month comprised in the period commencing on the 1st day of April of such assessment year
and ending on the date of making such application, on the additional amount of income-tax referred to in
that sub-section;
where as a result of an order of the Settlement Commission under sub-section
of section 245D
for any assessment year, the amount of total income disclosed in the application under sub-section
of
section 245C is increased, the assessee shall be liable to pay simple interest at the rate of one per cent. for
every month or part of a month comprised in the period commencing on the 1st day of April of such
assessment year and ending on the date of such order, on the amount by which the tax on the total income
determined on the basis of such order exceeds the tax on the total income disclosed in the application
filed under sub-section
of section 245C;
where, as a result of an order under sub-section
of section 245D, the amount on which
interest was payable under clause
has been increased or reduced, as the case may be, the interest shall
be increased or reduced accordingly;]
2[
where, as a result of an order of reassessment or recomputation under section 147 or
section 153A, the amount on which interest was payable in respect of shortfall in payment of advance tax
for any financial year under sub-section
is increased, the assessee shall be liable to pay simple interest
at the rate of one per cent. for every month or part of a month comprised in the period commencing on the
1st day of April next following such financial year and ending on the date of the reassessment or
recomputation under section 147 or section 153A, on the amount by which the tax on the total income
determined on the basis of the reassessment or recomputation exceeds the tax on the total income
determined under sub-section
of section 143 or on the basis of the regular assessment as referred to in
sub-section
where, as a result of an order under section 154 or section 155 or section 250 or section 254 or
section 260 or section 262 or section 263 or section 264 3***, the amount on which interest was payable
under sub-section
or sub-section
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 increased, the Assessing Officer shall serve on the assessee a
notice of demand in the prescribed form specifying the sum payable and such notice of demand shall
be deemed to be a notice under section 156 and the provisions of this Act shall apply accordingly;
in a case where the interest is reduced, the excess interest paid, if any, shall be refunded;
the provisions of this section shall apply in respect of assessments for the assessment year
commencing on the 1st day of April, 1989 and subsequent assessment years.]