Rule 269 sets how interest payable by an assessee or by the Central Government is calculated: whole months for annual interest, any part of a month counted as a full month where interest runs for every month or part of a month, and the sum rounded down to the nearest multiple of Rs. 100.
269
Rules 2026 · Rule 269
Procedure to be followed in calculating interest under section 533(2)(u)
Rules 261-310
The rule. In calculating interest payable by the assessee or by the Central Government under any provision of the Act: (a) where interest is calculated on an annual basis, the period is rounded off to a whole month or months, and any fraction of a month is ignored; (b) where interest is calculated for every month or part of a month in a period, any fraction of a month is treated as a full month; and (c) the amount of tax, penalty or other sum on which interest is calculated is rounded off to the nearest multiple of Rs. 100, ignoring any fraction of Rs. 100.