Where a discrepancy exists between the interest computed by the revenue and the assessee, and the revenue has not provided the detailed working for its computation, the matter should be restored to the Jurisdictional AO for de novo adjudication based on factual verification.

O R D E R

PER SANDEEP SINGH KARHAIL, J.M.

The assessee has filed the present appeal against the impugned order dated 31.12.2025, passed under section 250 of the Income Tax Act, 1961 (“the Act”) by the learned Additional / Joint Commissioner of Income Tax (Appeals) – 4, Hyderabad [“learned Addl./Joint CIT(A)”], which in turn arose from the intimation issued under section 143(1) of the Act, for the assessment year 2020-21.

In this appeal, the assessee has raised the following grounds: -

“I. INTEREST UNDER SECTION 234A, 234B AND 234C OF THE ACT:

1.1 On the facts and in circumstances of the case and in law, the learned Commissioner of Income-Tax (Appeals) [CIT(A)], erred in confirming interest charged under the provisions of Section 234A , 234B and 234C of the Act, while processing the Return of Income under Section 143(1) of the Act by the learned Assistant Director of Income Tax (CPC) (The Assessing Officer), (hereinafter referred to as "the AO").

1.2. The learned CIT(A) failed to appreciate the fact that the appellant trust is in the receipt of substantial dividend income in the month of March, 2020 and hence, could not have paid advance-tax in respect of such dividend income prior to 15.03.2020.

1.3. It is submitted that the First Proviso to Section 234C of the Act, is clearly applicable on the facts and in the circumstances of the case and interest charged under Section 234A , 234B and 234C of the Act is unwarranted and erroneous.

The appellant prays that the erroneous interest charged under Section 234A , 234B and 234C may be kindly deleted as the same is contrary to the law and invalid.”

We have considered the submissions of both sides and perused the material available on record. The brief facts of the case are that the assessee is a Trust and for the year under consideration, filed its return of income on 29.09.2020, declaring a total income of Rs.11,31,10,180/- and paid tax of Rs.1,62,30,152/-. Since no exemption was claimed under section 11 of the Act, the assessee was assessed as an Association of Persons. The return filed by the assessee was processed vide intimation dated 28.03.2021, levying interest of Rs.30,786/- under section 234A, Rs.82,852/- under section 234B and Rs.1,05,963/- under section 234C of the Act.

In its appeal before the learned Addl./Joint CIT(A) against the intimation issued under section 143(1) of the Act, the assessee submitted that it received substantial dividend income in the month of March 2020 and hence, could not pay advance tax in respect of such dividend income prior to 15.03.2020. The learned Addl./Joint CIT(A), vide impugned order, dismissed the appeal filed by the assessee and held that the assessee did not pay the entire tax liability arising on account of dividend received by it on 09.03.2020 by the time provided under 1st proviso to section 234C of the Act. Accordingly, the learned Addl. / Joint CIT(A) upheld the levy of interest under section 234C of the Act. Being aggrieved, the assessee is in appeal before us.

During the hearing, the learned Authorised Representative (“learned AR”) submitted that the assessee, during the relevant financial year, i.e., 2019-20, paid advance tax on 11.06.2019, 12.09.2019, 11.12.2019 and 11.03.2020. The learned AR further submitted that on 20.08.2020, the assessee also paid self-assessment tax. The learned AR submitted that while computing its total tax liability for the year under consideration, the assessee computed interest under section 234C of the Act at Rs.21,855/-. However, vide intimation issued under section 143(1) of the Act, the same was computed at Rs.1,05,960/-. The learned AR submitted that while paying the advance tax on 11.03.2020, the assessee also took into consideration the dividend income received on 09.03.2020. Therefore, after taking into consideration the advance tax paid in the entire year, the income amounting to Rs.15,39,322/- remained on which the tax was payable. Accordingly, on the said income, the