Answer

1. F

   Facts

   A demand is normally payable within 30 days of service of the notice. If unpaid after that, simple interest of 1% for every month or part of a month is charged under the 1961 Act.

2. P

   Provisions and law

   • 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).
   • Sec 156, Income-tax Act 1961 (now Sec 289)When tax, interest, penalty or other sum is payable after an order, the officer serves a notice of demand.
3. A

   Analysis

   On a demand of ₹80,000 served on 1 November, paying on 15 December, about two weeks after the 30-day period ended, attracts 1% for that part month, which is ₹800. Wait four months and it becomes ₹3,200. If the demand is wrong, the interest also falls when the demand is cancelled, but respond in time so you are not treated as in default.

4. C

   Conclusion

   1. 1Note the date the notice was served.
   2. 2Count 30 days for the due date.
   3. 3If correct, pay before the due date.
   4. 4If disputed, respond on the portal and start rectification or appeal.
   5. 5Keep proof of each step.

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