Applicability of interest u/s 234-B and C

[Sunil K. Jain]

Can the interest u/s 234-B and 234-C imposed where the assessment has been completed after proceedings u/s 147/148. Pl also provide the case law.

[CAGOPALJI AGRAWAL]

Interest u/s 234B would be leviable on the assessed tax in terms of the regular assessment made u/s 147 as per the explanation 2 to section 234B. But the interest u/s 234C is not leviable as the same is levied on shortfall of tax on RETURNED INCOME only not on assessed income.

AI Summary

Interest under section 234B imposed on assessed tax after reassessment; section 234C applies only to shortfall on returned income.
Interest under section 234B is leviable on tax assessed after reassessment proceedings under section 147/148 by virtue of the Explanation, whereas section 234C is levied only on shortfalls in installment liability based on returned income and does not apply to shortfalls arising solely from assessed income.