1197. Whether, in case last day for payment of any installment of advance tax is day on which receiving bank is closed, assessee can make payment on next immediately  following working day, and in such cases mandatory interest leviable under sections 234B and 234C would not be charged

1. Representations have been received by the Board seeking waiver of interest chargeable under sections 234B and 234C of the In­come-tax Act, 1961 for default in payment of instalments of ad­vance tax by the due dates which are prescribed under section 211 of the Income-tax Act. In cases where the last date for making payment of such instalments (i.e., 15th September, 15th December and 15th March) happens to be a holiday and the assessee pays the due amount of advance tax on the next working day.

2. The matter has been carefully considered by the Board and it is felt that in such cases section 10 of the General Clauses Act, 1897 will be applicable. This section lays down that where any Act or proceeding is directed or allowed to be done or taken in any Court or office on a certain day or within a prescribed period, then, if the Court or office (in the present case the bank which is authorised to receive payment of advance tax from the assessee) is closed on that day or on the last day of the prescribed period, the Act or proceeding shall be considered as done or taken in due time after it is done or taken on the next day, afterwards, on which the Court or office (or the bank) is open. In view of this provision, it is hereby clarified that if the last day for payment of any instalments of advance tax is a day on which the receiving bank is closed, the assessee can make the payment on the next immediately following working day, and in such cases, the mandatory interest  leviable under sections 234B and 234C of the Income-tax Act, 1961 would not be charged.

Circular : No. 676, dated 14-1-1994.

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September 2021