Answer

1. F

   Facts

   Interest in a demand usually comes from Secs 234A, 234B and 234C for the return year, and from 1% a month after the demand's due date if unpaid. Each is a simple percentage you can recompute.

2. P

   Provisions and law

   • Sec 234B, Income-tax Act 1961 (now Sec 424)Interest of 1% a month when advance tax paid is less than 90% of tax assessed.
   • Sec 234A, Income-tax Act 1961 (now Sec 423)Interest of 1% a month on unpaid tax for a late return.
   • Sec 220, Income-tax Act 1961A demand is payable within 30 days of service of the notice of demand; simple interest of 1% a month runs after that; the officer may allow more time or instalments, and may treat you as not in default while an appeal is pending (2025 Act number to be confirmed).
3. A

   Analysis

   For an assessed tax shortfall of ₹50,000 with no advance tax, 234B runs from 1 April of the assessment year till the date of the order: for 10 months that is ₹5,000. If you paid ₹30,000 as self-assessment tax in July, the interest after July is only on ₹20,000. Recompute with the dates and amounts; a mismatch is a rectifiable error.

4. C

   Conclusion

   1. 1List all interest lines in the order.
   2. 2Note the tax amount and the period for each.
   3. 3Recompute at 1% a month or part month.
   4. 4Check whether payments you made were deducted.
   5. 5File a rectification if the interest is wrong.

General guidance from TaxSavvy’s library of money processes. Laws change; your Savvy confirms the answer on your exact case before anything is filed.