TaxTMI 
TaxTMI 
2025 (4) TMI 2119
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.... "Income from other sources includes interest income from Bank savings accounts. The credit of interest amount in the savings accounts can be calculated only after the interest component has been credited into the savings accounts for FY 2022-23 on the last working day of the financial year i.e., 31st March, 2023, by the Bank. With the Reserve Bank of India, changing the policy interest rates, bimonthly during FY 2022-23 it was not possible to determine the interest income from savings Bank account to be accrued during the financial year at the beginning of the year i.e., on 1st April, 2022. Therefore, the presumption of paying Advance tax on the notional savings bank interest income to be accrued during the financial ....
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....e orders of the Ld. AO/Ld. CIT(A), the appellant filed the present appeal. The main argument of Ld. AR of the appellant before the ITAT is that Savings Bank interest cannot be anticipated and interest under section 234B and 234C of the Act cannot be charged on the tax payable by the appellant. The appellant pleads that the interest under section 234B and 234C of the Act are penal in nature, as he is using the words "penalised" "penalty" in grounds of appeal for the charge of interest under these sections. It was also argued before the Bench that it is only logical and realistically practical than an individual tax payer will calculate the savings bank account interest amount credited to his savings account, while filing Income Tax Return fo....
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....ections. Once charging of advance tax is attracted, the default of the same attracts interest under section 234A, 234B and 234C of the Act. In the written submissions filed by the Ld. DR, it was mentioned that the appellant should have a credit balance of Rs. 16 lakhs to 17 lakhs in his savings bank account by reversing the working since the appellant paid Rs. 30,355/- as self assessment tax. Secondly, the appellant has not submitted the detailed break up of interest as directed by the Bench. Thirdly, the reliance placed on the decision of Hon'ble Bombay High Court by the Ld. AR of the appellant is not applicable to the facts of the case, because the Prime Securities case relied on by the appellant relates to issue of invalid ITR earlie....
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....e end of every quarter. It is not notional income but actual receipt. c) As the Ld. AR of the appellant has placed heavy reliance on the case of Prime Securities Ltd., (supra) the decision of Hon'ble Bombay High Court was perused and analysed. At para 8, it was held that the impugned appellant had also to estimate all the incomes. It implies interest income of savings bank account, which is definite and ascertainable because the rate of interest is known to everyone and appellant is in the exclusive knowledge of interest credited every quarter. If the appellant does not pay advance tax on this income which was credited every quarter in his bank account, it is clearly a default and interest under section 234B and 234C is clearly....
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....ellant's argument is not logical. f) Before 31.3.2023, the appellant knows the total amount of savings bank account interest credited to his and account fully, but did not pay advance tax on the same and interest which is compensatory has to be paid. For example, the appellant paid advance tax of Rs. 60,000/- on 12.3.2023 and Rs. 30,555/- SA tax on 9.7.2023. As the appellant knows his total interest income by 31.3.2023, he had to pay advance tax as per the installments mentioned under section 209 and 210 of the I.T. Act failing which interest under section 234B and 234C are leviable. g) The cardinal principle of levying interest/paying interest is that if appellant keeps the money of Revenue i.e. tax, without adhering to t....