Interest under section 220 (2) on order received u/s 245d(4)

[Akshay Jain]

As per the order u/s 245 it is mentioned as follows ' The applicant requested for installment facility in paying the balance tax demand. This is considered and the applicant is allowed to pay the demand along with interest arising on account of giving effect to this order within six months ( in six equal monthly instalments) after receipt of notice of demand '

As per the Assessment order issued in response to this order u/s 245D(4) certain demand is raised and the AO has mentioned a point saying ' The demand may be paid in 6 equal monthly installments. The last installment to be paid with interest u/s 220(2).'

Question :

1) Is interest u/s 220(2) applicable on order u/s 245D(4) even if order itself gives a relief of 6 installments ???

2) If applicable then under what circumstances can it be waived off.????

AI Summary

Interest Under Section 220(2) Applicable on Installment Payment Orders Under Section 245D(4) Despite Relief An individual inquired whether interest under section 220(2) is applicable on an order under section 245D(4) when the order allows payment in six installments. The assessment order specified that the last installment should include interest under section 220(2). A respondent agreed with the assessing officer's position, implying that interest is applicable despite the installment relief. The inquiry also sought clarification on circumstances under which the interest could be waived, but the response did not address this aspect.