Date for Calculation of Interest U/s 234- Date of Cheque presentation or Clearing?

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MADRAS HIGH COURT

Commissioner of Income Tax Chennai.
Vs.
REPCO Home Finance Ltd.

T.C.(A).No.601 of 2014
DATED: 11.11.2014

Issue- Whether interest under Section 234C of the Act is to be calculated based on date of clearing of the cheque or date of presentation of the cheque.

Held- It is not the case of the department that the cheque issued by the assessee was dishonourned. Once the cheque issued by the assessee is encashed, in the light of the decisions referred supra, the payment relates back to the date of receipt of the cheque.