CHANGEABILITY OF INTEREST UNDER SECTION 17B OF THE WEALTH TAX ACT, 1957 ON SELF ASSESSMENT TAX PAID BEFORE THE DUE DATE OF FILING OF RETURN OF NET WEALTH
Before a day CBDT has issued a circular No. 5/2015 regarding Changeability of Interest u/s. 17B of the Wealth-Tax Act, 1957, on self assessment tax paid before the due date of filing of return of net wealth.
Interest u/s. 17B of the Wealth-Tax Act (hereinafter the Act) is charged in case of default in furnishing of return of net wealth by an assessee. The interest is charged at the specified rate o the amount of tax payable on the net wealth. Since the provisions of section 17B do not provide for reduction of the amount of self-assessment tax from the amount on which interest under section 17B is chargeable, interest is being charged on the amount of self assessment tax paid by the assessee even before the due date of filing of return of net wealth.
It has been held by the Hon'ble Supreme Court in the case of CIT vs. Pranny Roy 309 ITR 231 (2009) that the interest under section 234A of the Income Tax Act, 1961 on default in furnishing return of income shall be payable only on the amount of tax that has not been deposited before the due date of filing of the Income Tax Return for the relevant assessment year. The central Board of Direct Taxes (the Board) has already issued Circular No. 2/2015 dated 10.02.2015 giving effect to the decision of the Hon'ble supreme Court with regard to the provisions under the Income-Tax Act. Maintaining an analogous position with regard to the provisions under the Wealth Tax Act, the Board has decided that no interest under section 17B of the Wealth-Tax Act is chargeable on the amount of Self-Assessment tax paid by the Assessee before the due date of filing return of net wealth.
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