Tax Refunds Under Section 34A: Conditions, Interest Rates, and Calculation Methods for Assessments Before and After 1989
The amendment to section 34A of the Wealth-tax Act establishes conditions for tax refunds. When assessments are set aside or cancelled, refunds become due only after fresh assessment or only for tax paid in excess of chargeable tax. Sub-sections (3), (3A), and (4) will not apply to assessments from April 1, 1989 onward. For these newer assessments, taxpayers are entitled to 1.5% simple interest per month on refunds from the date of tax payment to refund grant. If refund delays are attributable to the taxpayer, that period is excluded from interest calculations. When refund amounts change due to subsequent orders, interest is adjusted accordingly.
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