Interest u/s 220(2) of Income - Tax Act, 1961. - Income Tax - 478/CBDT

INSTRUCTION NO. 478/CBDT November 15, 1972 Section(s) Referred: 220(2) ,225(2) ,225(4) Statute: Income - Tax Act, 1961 In has been observed that no uniform procedure is followed in different Commissioner of Income-tax charges for charging interest u/s 220(2) for the period before and after the issue of a Tax Recovery certificate. The Board desire that the following procedure should be followed in all the charges: (a) The I.T. Officer should charge the interest u/s 220(2) upto the date of the issue of recovery certificate and the TRO should charge the interest for the subsequent period. Where any revision or rectification order is passed after the issue of the recovery certificate and consequently there is enhancement or reduction in demand an amended certificate must be sent to the TRO u/s 225(4). (b) Similarly, the I.T. Officer must send an intimation to the TRO of any tax paid, vide section 225(2). (c) Where as a result of appeal, revision or rectification etc., further demand is raised, the I.T. Officer has to make efforts towards recovery and according to law, issue if necessary a further recovery certificate for unrealised demand and in such a case the provisions of sub-paras (a) and (b) above will apply again. (d) While reporting the collections the TRO must indicate clearly tax, and interest as charged by the I.T.O and by the TRO separately. 2. The above instructions may please be brought to the notice of all officers working in your charge.