Interest
payable by assessee.
38215. 39[40(1) Where, in any financial year, an assessee has paid 41[advance tax under section
209A or section 212 on the basis of his own
estimate (including revised estimate)], and the advance tax so paid is less
than seventy-five per cent of the assessed tax, simple interest at the rate of 42[fifteen] per cent per annum from the 1st day
of April next following the said financial year up to the date of the regular
assessment shall be payable by the assessee upon the amount by which the
advance tax so paid falls short of the assessed tax :]
43[Provided that in the case of an
assessee, being a company, the provisions of this sub-section shall have effect
as if for the words “seventy-five per cent”, the words “eighty-three and
one-third per cent” had been substituted.]
44[(2) Where before the date of completion of a
regular assessment, tax is paid by the assessee under section
140A or otherwise,—
(i) interest shall be calculated in accordance
with the foregoing provision up to the date on which the tax is so paid ; and
(ii) thereafter, interest shall be calculated at
the rate aforesaid on the amount by which the tax as so paid (in so far as it
relates to income subject to advance tax) falls short of the assessed tax.]
45[(3) Where as a result of an order under section 147 or section 154
or section 155 or section
250 or section 254 or section
260 or section 262 or section
263 or section 264 46[or an order of the Settlement Commission
under sub-section (4) of section 245D], the
amount on which interest was payable under sub-section (1) has been increased
or reduced, as the case may be, the interest shall be increased or reduced
accordingly, and—
(i) in a case where the interest is increased, the
47[Assessing] Officer shall serve on the
assessee, a notice of demand in the prescribed form specifying the sum payable,
and such notice of demand shall be deemed to be a notice under section 156 and the provisions of this Act shall
apply accordingly ;
(ii) in a case where the interest is reduced, the
excess interest paid, if any, shall be refunded.]
(4) In such cases and under such circumstances
as may be prescribed48, the 49[Assessing] Officer may reduce or waive the interest payable by the
assessee under this section.
50[(5) In this section and sections 217 and 273, “assessed
tax” means the tax determined on the basis of the regular assessment (reduced
by the amount of tax deductible in accordance with the provisions of sections 192 to 194,
section 194A 51[, section 194C] 52[, section 194D]
53[, section 195
and section 196A] so far as such tax relates to
income subject to advance tax and so far as it is not due to variations in the
rates of tax made by the Finance Act enacted for the year for which the regular
assessment is made.]
54[(6) Where, in relation to an assessment year,
an assessment is made for the first time under section
147, the assessment so made shall be regarded as a regular assessment for
the purposes of this section and sections 216, 217 and 273.]