02 November 2014

Interest U/s 234 A Stayed


Madras High Court Stays Clause 7 of CBDT Order dated 26-09-2014 regarding Extension of ITR Due Date AY 2014-15 with Levy of Interest u/s 234A

 

 

Earlier on 26-09-2014 CBDT, following the direction of the Gujarat High Court had extended the due date for Income Tax Returns (ITR) filing from 30th September, 2014 to 30th November, 2014 for assessee covered under tax audit us 44AB of Income Tax Act, 1961.

However, the clause 7 of CBDT order dated 26-09-2014 provided that assessee shall have to pay interest under section 234A for the period of the extension granted.

Clause 7 of CBDT Order is reproduced hereunder:

7. There shall be no extension of the "due date" for the purposes of Explanation 1 to section 234A (Interest for defaults in furnishing return) of the Act and the assessees shall remain liable for payment of interest as per the provisions of section 234A of the Act.

Now, it is reported that the Madras High Court has granted a stay on the operation of the clause 7 of the said order of CBDT and has issued a direction to Income Tax to accept returns without interest.

The full details of the order are awaited.

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