What is Interest on excess refund? What is Fee for
default in furnishing statements?
234D and 234E of Income Tax Act 1961
Interest on excess refund and Fee for default in
furnishing statements are defined under section
234D and 234E of Income Tax Act 1961. Provisions under these Sections
Section 234D of Income Tax Act "Interest on
Section 234D. (1) Subject to the other provisions of this
Act, where any refund is granted to the assessee under
sub-section (1) of section 143, and-
(a) no refund is due on regular assessment; or
(b) the amount refunded under sub-section (1) of section
143 exceeds the amount refundable on regular assessment, the
assessee shall be liable to pay simple interest at the rate
of one-half per cent on the whole or the excess amount so
refunded, for every month or part of a month comprised in
the period from the date of grant of refund to the date of
such regular assessment.
(2) Where, as a result of an order under section 154 or
section 155 or section 250 or section 254 or section 260 or
section 262 or section 263 or section 264 or an order of the
Settlement Commission under sub-section (4) of section 245D,
the amount of refund granted under sub-section (1) of
section 143 is held to be correctly allowed, either in whole
or in part, as the case may be, then, the interest
chargeable, if any, under sub-section (1) shall be reduced
Explanation 1.-Where, in relation to an assessment year,
an assessment is made for the first time under section 147
or section 153A, the assessment so made shall be regarded as
a regular assessment for the purposes of this section.
Explanation 2.-For the removal of doubts, it is hereby
declared that the provisions of this section shall also
apply to an assessment year commencing before the 1st day of
June, 2003 if the proceedings in respect of such assessment
year is completed after the said date.
Section 234E of Income Tax Act "Fee for default
in furnishing statements"
Section 234E. (1) Without
prejudice to the provisions of the Act, where a person fails
to deliver or cause to be delivered a statement within the
time prescribed in sub-section (3) of section 200 or the
proviso to sub-section (3) of section 206C, he shall be
liable to pay, by way of fee, a sum of two hundred rupees
for every day during which the failure continues.
amount of fee referred to in sub-section (1) shall not
exceed the amount of tax deductible or collectible, as the
case may be.
(3) The amount of fee referred to in
sub-section (1) shall be paid before delivering or causing
to be delivered a statement in accordance with sub-section
(3) of section 200 or the proviso to sub-section (3) of
(4) The provisions of this section shall
apply to a statement referred to in sub-section (3) of
section 200 or the proviso to sub-section (3) of section
206C which is to be delivered or caused to be delivered for
tax deducted at source or tax collected at source, as the
case may be, on or after the 1st day of July, 2012.