INTEREST U/S 234C

[NABIN AGARWAL]

A Company earned Capital Gain income in March'15 by selling an Immovable Property but need to pay tax U/s 115JB as because normal tax is lower than MAT tax. Can it be allowed to pay Interest U/s 234C for last quarter only as Income is solely from Capital Gain occured in March'15. though he is laible to pay tax U/s 115JB ??? Please reply with Case Law and Section in support of your answer.

[RAMA KRISHNA KNVS]

Advance tax payment is made towards estimated tax liability for year as a whole. as Mar-15 is due date for 4th installamnet, by that time the capital gain tax must have been known. so such computation of interest as suggested by u will not be allowed under law.

AI Summary

Underpayment of advance tax: interest cannot be limited to the last instalment where year end capital gains crystallised. A company realising capital gains in the final month must treat advance tax as liability for the year as a whole; interest under section 234C cannot be limited to the last instalment where the capital gain was known by the due date, and instalment payments must reflect the crystallised liability including any Minimum Alternate Tax consequences.