INCOME TAX

Payment of advance tax in instalments by the due dates under sections 210 and 211 of the Income-tax Act--Last day being holiday--Clarification regarding.

Circular No. 676

Dated 14/1/1994

To

All Chief Commissioners of Income-tax/

All Directors-General of Income-tax.

Sir,

Representations have been received by the Board seeking waiver of interest chargeable under sections 234B and 234C of the Income-tax Act, 1961, for default in payment of instalments of advance tax by the due dates (which are prescribed under section 211 of the Income-tax Act) in cases where the last date for making payment of such instalments (i.e. 15th September, 15th December and 15th March) happens to be a holiday and the assessee pays the due amount of advance tax on the next working day.

2. The matter has been carefully considered by the Board and it is felt that in such cases section 10 of the General Clauses Act, 1897, will be applicable. This section lays down that where any act or proceeding is directed or allowed to be done or taken in any court or office on a certain day or within a prescribed period, then, if the court or office (in the present case the bank which is authorised to receive payment of advance tax from the assessee) is closed on that day or on the last day of the prescribed period, the act or proceeding shall be considered as done or taken in due time after it is done or taken on the next day, afterwards, on which the court or office (or the bank) is open. In view of this provision, it is hereby clarified that if the last day for payment of any instalments of advance tax is a day on which the receiving bank is closed, the assessee can make the payment on the next immediately following working day, and in such cases, the mandatory interest leviable under sections 234B and 234C of the Income-tax Act, 1961, would not be charged.

3. These instructions may be brought to the notice of all the Assessing Officers under your jurisdiction.

Yours faithfully,

(Sd.) Rajesh Chandra,

Under Secretary (Budget),

Central Board of Direct Taxes.