Advocate C P Chugh
I have raised the following query with CPC-TDS on procedure for closer of demand created by CPC-TDS in case of invalid PAN.
Dear Sir/Ma’am,
Thank you for contacting us, it is our pleasure to assist you.
Your query related to PAN error default is acknowledged.
It is to inform you that the provisions of section 206AA apply at the time of tax deduction, which happens prior to the filing of statement. Thus, the deductor is expected to have a Valid PAN at the time of deduction. Only a typographical error is expected at the time of filing the TDS statement.
The demand in the hands of the deductors is being rectified in cases where the difference between the Invalid PAN and the Valid PAN is not more than 2 characters. This is being done in order to take care of the genuine typographical errors in data entry.
The rectification of demand in other cases is not done if the mismatch is more than two alpha characters & two numerics. Therefore, out of 10 characters in case of structurally valid PAN, 4 characters are being considered for rectification of demand.
Regards,
Team TDS CPC
Opinion is sought if the approach of CPC is lawful and correct. If not what is the course of action avaialble to the deductor. Unable to find from where the presumption and powers………..CPC-TDS……….draws in respect of highlighted portion of reply.
CPC is replaying that we have make 20% TDS on the Base amount
now we can submit form 26A
Hello Sir/ Madam.,
I have filed original tds return filed for PAN number error and then i had filed revised return for PAN Number corrected. But, i have received demand of Rs.48,000/-. you have TDS Rates applicable sec.206AA.
How to rectify the demand amount.
Thanks and best regard.,
this is utterly rubbish. i wonder how many people are aware of this bullshit. a wrong deed is always justifiable to rectify at least once. section 206a is not complying at all with what TRACES is saying. JANTA MAAF NEHI KAREGI!!!!
I have entered wrong PAN card no in quarterly filing. and my remark is wrong and i have got penalty of Rs.40000 and above in DEFAULT sheet in TDSCPC. So please give me a justified answer to solve this problum and to return the penalty amount.
The income tax department has eased its lengthy process by enabling online correction of PAN and Challan via TRACES website
Income Tax (I-T) Department’s has eased the process of correction or modifications in PAN and challan. The TDS reconciliation analysis and correction enabling system (TRACES) has eased the lengthy process and becomes more user-friendly and hassle free with few easy steps in correcting errors by enabling online correction of PAN and challan.
The good news is now tax payers do not need to go through a long procedure of filing ‘revised return’ just to change or rectify the PAN details. Tax payers, after logging into their account on TRACES website,can directly file online correction for PAN and challan errors.
The process of correcting PAN and challan errors is described well in E-Tutorials which made it easier. It is also safe and secure as it requires digital signature mandatorily before correcting any errors. Tax payers can register their digital signature in ‘profile’ after registration. TRACES also enables online registration of digital signature.
TRACES can also enable refund of Challan and online verification of Tax deduction at source (TDS) certificate.
TRACES has been set up by TDS centralised processing cell of the income-tax department. Income tax department’s initiative of TRACES is a web-based application which provides an interface to all stakeholders associated with TDS administration. It provides online correction of TDS returns, viewing of challan status, downloading of various conso files, justification report and Form 16 /16A, as well as viewing of annual tax credit statements (Form 26AS).
how to enter the correct pan in conso data after the same is loaded. now it is allowing to download the conso , saying no correct pan is avaialbl
e atlease 1 pan must be correct. if so what is the recourse? whom to contact to provide correct pan now
There is nothing in the Income Tax law or circular or any notification that if there is a mistake of 2 alphabets or 2 numbers than 20% TDS is applicable. TDS CPC said that it is their internal circular. I would request bodies like Institute of Chartered Accountants to take up the issue with Government of India.
I paid TDS challan for Q3 but forgot to enter that challan data while uploading TDS returns.. can i use that challan in Q4 for same data
Hi Neo,
You only need to revise the return. Reprocessing will clear the notice. Check the Status of the statements as per CPC site. It will either display “Processed with defaults” or “Processed without defaults”.
HOW TO CANCEL THAT NOTICE OF DEMAND ,AFTER FILING OF CORRECTION STATEMENT OR CORRECTING HE PAN NO
there r no provisions under the IT Act, 1961, which restrict or quantified the definition of correction in PAN upto 2 letters, in my opinion the justice will be available at CIT(A). Mistake/error cannot be restricted or defined upto certain letters.
Dear Mr. Harish Chandra,
According to TDSCPC – “Vaild PAN to Valid PAN Correction is not allowed more than once”. One of our dealer gave different PAN Nos thrice and we have filed Correction statements accordingly. One of the Correction statements was rejected stating the above reason.
It means if the PAN filed is a valid PAN, you can correct it only once.
sir
there should be the rectificatuion facility in mistake of PAn Nos.
supose a partner has given his on PAN insteard of firm in the case of the firm then what will be the circumstances. He will not be credited in his on case and firm has to calim for the refund. P. Reply me how to rectify the matter.
They are not considering the Interest paid through separate challan , we filed regular statement with Interest on late payment which was paid through distinct challans but didn’t consider the Interest challan and raised a demand of Rs 6040/ for same.
May god guide them or give us strength to bear the pain !
CPC TDS is doing all one sided at its own discretion without going into the provisions of law. Section 154 intimations are being issued without giving any opportunity to the assesseee inspite of the clear provisions of the act. Surcharge on TDS is being demanded in case of company deductees even when the total payment is much below the specified limit of payment of one crore for charging Surcharge on tax. Even mistake is of the department the paper applications filed are not accepted and online rectifications are demanded even when there is no mistake in returns filed.
The processing of revised return is also done thru CPC and they will retain the demand so created on the deductor despite revised return. The reply referrred to above from CPC is after filing of revised return and receipt of demand notice from CPC.
Further this law is absurd since it does not find any mention anywhere in the Act of Rules and has been designed by the CPC team.
Another arbitrary stand taken by CPC has been the interest charged on late deposit of TDS.
As per the current laws one get time till the 7th of the succeeding month for deposit of TDS for the preceding month. However, if you deposit the tax even by one day, CPC is charging interest for two months and not one month. No body is hearing in CPC and they proudly claim that this is their right as per the law which has been wrongly worded. When as per law i am allowed to deposit TDS up to a given time frame, the charge of interest should be from the said date to the date when one has deposited. You cannot withdraw the time already provided to an assessee. Lot of demand are being created and deductor has to deposit interest not knowing why the demand has been raised by CPC.
This is very clear that the assessess should not make any mistakes and if mistakes happen get penalised by the TDS Department. But what if the mistakes happen from the Income Tax Department’s end, should they not be penalised and assessees be compensated for the mistake done from their end also.
this is no fair
This is very clear that the assessess should not make any mistakes and if mistakes happen get penalised by the TDS Department. But what if the mistakes happen from the Income Tax Department’s end, should they not be penalised and assessees be compensated for the mistake done from their end also.
CPC IS NOT RIGHT, MISTAKE CAN HAPPENED AND IT IS NOT ALWAY S RESTRICTED TO 2 CHARACTERS WHICH CAN BE FOUND OUT LATTER. HENCE, ALWAYS THERE SHOULD BE A CHANCE TO RECTIFY THE MISTAKE AT LEAST AT THE FIRST TIME.
There is no room for approaching the CPC online for valid query, which could otherwise have been addressed manually by TDS ITOs. Hence, the CBDT should have taken congnisance of all these injustices suomoto and address the same. if thepowers exercised by the CPC is not legal, there is no need to heed to it.
Dear All,
This is very clear that the assessess should not make any mistakes and if mistakes happen get penalised by the TDS Department. But what if the mistakes happen from the Income Tax Department’s end, should they not be penalised and assessees be compensated for the mistake done from their end also.
THIS IS COORECTLY WRITTEN THAT ALL RULE OF INDIA ARE OF BRITISH BCOZ THEY FELL THAT THESE PEOPLE NEVER BE OF THEM(BRITICIANS)BUT NOW THERE IS ALSO EVERY WHERE THE BRITISH REFLECTION SEEN WHEN EVER THERE IS NEED TO URGE NO BODY IS CARE OF OTHERS WHICH WAS MAIN MENIFESTO OF BHARTIYA PEOPLES SHOULD THERE BE A GREAT REFORMATION OF THESE PEOPLES SOULS THANKS
TDSCPC has processed form 24Q for FY 2009-10 on 14.11.2013. They have processed it with surcharge which is not applicable for FY 2009-10 for TDS on income under section 192B. Also they have raised a demand for short deduction for the transactions for which the TDs was correctly deducted and are very much visible in the data from the latest Conso file downloaded from TRACES. Total demand raised was for Rs. 5.38 lakhs.
Detailed Mail showing the mistakes in the processing was sent to CPC-TDS on 29.11.2013. There is no response whatsoever till date.
TDSCPC is putting all the assesses into lot of hardship. Wish the Trade Associations and professional associations make a collective representation to TDSCPC in this matter otherwise the high handed approach of TDSCPC will continue.
The CPC cannot restrict correction of any details in PAN No like 2 letters, 2 nos in terms of no legal provisions available in the Act, Rules, Circulars, etc… Suitable reference to be provided by CPC with regards to reply stated
It will proceed to undue harrassment on the assessee / deductor.
This is an eye opener for the concerned higher authorities . People who had no idea of law ,its application and implication had been authorised to handel these type of issues . Higher Authorities should take appropriate steps to resolve the issue and safeguard assessee from unnecessary harresement in the hand of CPC TDs Officials .
absurd reply
This is one more example how innocent assessee is harrased by our system.
There are no.of examples.
Is ombudsman a way to solve this ?
It looks totally unfair provision. Before implementing such provision law should be amended or at least a notification informing such system setting should be made available to professional.
sir,
kindly do not make more than TWO MISTAKES.If the difference between the Invalid PAN and the Valid PAN is not more than 2 characters then both the deductor and deductee both has to forgo the TDS? I hope that un less the hon’courts come in to picture the CPC will not learn any lesson.Mistakes do happen while working,just a mistake has happened is is natural justice to denaly the rightful TDS? Man it self has born by mistake and ONLY MAN CAN MAKE MISTAKE.If the CPC is not managed by man it is ok
If dedcutor has given the PAN and the deductoe has filed the TDS return later on the PAN founds to be invalid then there is no liability on the part of the deductor and as per law the deductor has to quote the PAN and no where it is written that it should be a valid PAN.
The whole sytem is changing without any decipline. Rules and acts are frequently amended without considering practical problems
QUESION
WHAT ARE THE TIME LIMIT FOR PROCESSING OF RETURN 24Q,26Q
IN CORRECTION RETURN WE HAVE CHECKED DAILY. TDSCPC SERVER SAYS PENDING WITH PROCESSING.
TELL ME THE TIME LIMIT OF TDS STATEMENTS BOTH REGULAR AND CORRECTION.
DEALY IN PROCESSING BY IT – HOW MUCH THE FINE AMOUNT?
It is shocking ! Can somebody throw light on this very important issue raised by Mr.C.P.Chugh. Error is error. How can it be restricted to 2 alphabets and all that ! Its utterly nonsense.Who gives them powers to decide all this ?
This way, people will avoid doing TDS itself. It is definetly not in good interest at all.
To my mind Mr.Chug you should directly approach Chief Commissioner for a resolution to the problem, if no favorable steps initiated by him, then you should go on appeal against the order of the CPC-TDS.
It is said in the query that incase of PANNOTAVBL tax had been deducted adn deposited @ 20% (the opening line of the query).
If this is the case then where is the short fall? You have rightly dedcuted and eposited the tax. No dmeand should arise under the circumstances. And if the TDSCPC has raised the demand under the circumstances, the demand is itself erroneous.
But if you had dedcuted tax at lower rate than 20% in case of of PANNOTAVBL and filed the return and thereafter you had filed correction return with VALID PANs for those PANNOTAVBL records, then in my opinion, the view taken by the CPC is correct and as per law. Since section 206AA squarely covers that if the deductee fails to furnish valid PAN to the dedcutor then the dedcutor is under obligation to deduct tax at higher rate of 20%. The plain reading of Section 206AA suggets that the deductee has to intimate the PAN to the deductor at the time of deduction of tax failing which dedcutor shall deduct tax @ 20%.
However, in practical cases one may deduct tax at lower rate applicable for the section on the belief and faith that the deductee will furnish the PAN before filing of return. That is the time upto which a dedcutor can wait to obtain the PAN from deductee.
What are your views on this?
This is absolutely high handed ness of the CPC. CPC should function to provide support to the tax payer and extend help of its expertise to general tax payers at large.
I too had a case where by Assessee while depositing Self Assessment TAx, put his PAN which was wrong. The PAN mentioned by him, in fact does not exist and the Tax amount is lying in suspense account.
No one is ready to help and correct the PAN inspite of so many correspondance.
See if any one can guide me in the matter.
This is highly unjustified and illegal. At the time of making deduction and uploading the form the deductor may not have the PAN of deductee but it does not mean that the deductee does not have the PAN. If the deductee subsequently informs the PAN, deductor should be allowed to correct the form. In case it is not allowed, the TDS would not appear in the deductee account. Under such circumstances, how he will claim the TDS? Thus, it would be a pure case of unjust enrichment by the Govt.
In my opinion, the Approach of the CPC is not correct in this regard. The rectification of errors of this type needs a relook and ultimately the deductee should get the credit for the taxes in Form 26AS after rectification as it is their money at stake. CBDT and Ministry needs to take appropriate action in this regard.
It ia totally unjustified.
According to me, Assessee has ful right to rectify the PAN, even if it may exceed to more than 2 alphabet.
For example, At times, it may happen that instead of punching X ltd, by CA, staff has punched Y Ltd.
In such cases, it leads to heavy demand to the client as well as loss of time and energy.
I think, we should take up the matter and represent before the higher authorty very strongly.
Reply of CPC is not valid , hence null and void. CPC has no power of fixing any norms for error in PAN unless and until the same has been defined in Income Tax Act itself. One can go for appeal against such order. File a application against this correction of error in the statement with jurisdictional TDS ward where the same will be corrected or if they pass order then go for appeal.
Sir, even i have received same reply from TDS CPC. It seems as they have made this standard reply to send to deductors.
Also, in my opinion what TDSCPC is doing is bad in law. As soon as we file revise return it replaces the orginal return and hence this stand is not correct that TDS has to be deducted @ 20% for invalid PANs at time of deduction. Also, as a dedcutor i cannot verify all the PANs before dedcution of TDS, this is more so in case of Banks having hundreds or even thousands of deductees.
It is unclear at what authority level, we can raise this issue. Only PIL to High Court would be helpful in this case as there is no one to listen.
Dear Chugh Ji,
I was not able to fully understand the query.
Do send the files at the above address or contact via mobile at 9876739911.
CA Kanwaljit Singh Dhunna
What sort of powers are bestowed on these guys wherein they are just not questioned for any acts of theirs. Have we the people of India given them the powers or is it that they have inherited the rules made for the officers of British Raj who had bestowed these powers to suppress any uprising of the people.
On what basis the 2 characters – aplha or numeric have been decided. What happens when a person erronously keys in same PAN in 2 different assessees. Are they not aware that a lot of awareness is yet to spread among the general public at lower levels about the importance of PAN. Are they not aware that I Tax department has also issued duplicate PAN to same person. Need to write to the top authority to provide the justification on the basis of implementation of such clauses
This 2 character concept is fixed by CPC only or it is specifically mentioned in the Act or rule. Pl updatd.
It is realy surprising. On basis of which provision of the act the CPC has taken this decision. This is the dictatorship type decision in democratic country. Realy is des ka bhagwan hi malik hai.
CPC IS NOT RIGHT, MISTAKE CAN HAPPENED AND IT IS NOT ALWAY S RESTRICTED TO 2 CHARACTERS WHICH CAN BE FOUND OUT LATTER. HENCE, ALWAYS THERE SHOULD BE A CHANCE TO RECTIFY THE MISTAKE AT LEAST AT THE FIRST TIME.
Yes we have to file a pill against this TRACES for making the assesses very inconvenience. The procedures should be flexible. They should not become headache to assesses. After launching TRACES, we are even unable to concentrate fully on growth of our business.
NOT ABLE TO UNDERSTAND FOLLOWING…
“out of 10 characters in case of structurally valid PAN, 4 characters are being considered for rectification of demand.”
The better option is to file a revise return and correct all PAN. Why should we depend on CPC for rectification. Update the PAN data in the revised return, once the Return is processed all demand will automatically get nullified.