Summary: TDS deposition system for government deductors allows taxes collected by government offices to be credited to the Central Government account without generating ITNS 281 challans, under Rules 30(4), 30(4A), 30(4B), and 30(4C) of the Income Tax Rules, 1962. Each Drawing and Disbursing Officer (DDO) is allotted a TAN and reports to a Pay and Accounts Officer (PAO), District Treasury Officer (DTO), or Cheque Drawing and Disbursing Officer (CDDO), each of whom receives an Account Office Identification Number (AIN). Monthly consolidated Form 24G is filed by PAO/DTO/CDDO with details of TDS/TCS payments for all mapped TANs. Upon submission, a Book Adjustment Identification Number (BIN) is generated for each DDO, enabling them to file TDS/TCS statements (Forms 24Q/26Q/27Q/27EQ). The Income Tax Department processes these statements, credits tax to the relevant PAN holders, and issues TDS certificates. For state governments, a “special TAN” is used with ITNS 281 for consolidated deposits. Ultimately, TDS credit reaches PAN holders through a structured book-entry mechanism.
When the tax is collected/deducted by Government office, the same can be deposited to the account of Central Government without challan ITNS 281. Rule 30(4), 30(4A), 30(4B) and 30(4C) of the Income Tax Rules 1962 explains the procedure, which is as follows:
In Government accounting system, each Drawing and Disbursing Officer (DDO) responsible for TDS is allotted a TAN.
DDO – A government officer or organisation authorised to draw funds from treasury and disburse it to payees.
Each DDO reports to Pay and Accounts Officer (PAO)/ District treasury Officer (DTO)/ Cheque Drawing and Disbursing Officer (CDDO). These PAO, DTO and CDDO are allotted Account Office Identification Number (AIN) and details of TDS is passed on to these officers by the DDO.
AIN – 7-digit unique number required to be obtained from ITD by every PAO, DTO, CDDO. This is obtained through application made to CIT(TDS) concerned. After verification of application, CIT(TDS) recommends it for generation of AIN and sends the application to NSDL which then generates AIN.
TAN of the DDO and AIN of the concerned PAO, DTO, CDDO are then mapped.
These officers make book entry for transfer of TDS credit, by way of filing Form 24G every month using their AIN, to the account of the Central Government.
Form 24G – Every PAO, DTO, CDDO shall furnish 1 consolidated Form 24G in respect of TDS/TCS which has been paid without generation of challan. Form 24G shall be furnished by 15th of the next month and this form is filed for all the TAN mapped with the respective AIN on the NSDL portal having the following details:
- Personal details of PAO, DTO, CDDO – Name, demographics, contact
- Category – Central or State government along with Ministry concerned
- Month and year for which 24G is being filed
- Payment summary
- Nature of deduction – TDS on salary, non-salary, non-resident, TCS etc
- DDO wise payment details – Name, TAN, demographics, total tax deducted/collected and remitted to the Government account.
Special TAN is applicable in case of State government – Only case where consolidated ITNS281 is required (This is not applicable in case of Central government)
A book transfer entry is prepared by the Accounts officer and sent to the State AG office. State AG office then accumulates the transfer entries from all PAO, DTO and CDDO and draws a consolidated draft in favour of ITD through ITNS281 and deposit it to Government account. TAN used by State AG is called the “special TAN”.
After filing 24G, a Book Adjustment Identification Number (BIN) is generated for each DDO and the same is communicated to them by the respective PAO, DTO, CDDO.
Now, based on the BIN, the DDO files TDS/TCS statements in Form 24Q, 26Q, 27Q, 27EQ, as the case maybe, on the traces portal.
ITD process the TDS/TCS statements filed by DDO and passes on the TDS/TCS credit to the PAN holders relating to whom the tax has been supposedly deducted/collected. Thereafter, the TDS/TCS certificate is issued to the PAN-holder and the said tax credit gets reflected in Form 26AS/AIS of the PAN holder.
Bottomline – In Government Accounting System, the TDS credit is passed on to PAN holder by way of book entry.
Author Bio
