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16. eTDS RETURN WITH LESS THAN REQUIRED PAN SOLUTION (OFFICIAL WORD)

As you may aware of that that its mandatory to give details of pan of deductee in etds return .CBDT has increased the % by press release on 12.02.2008 applicable from 01.04.2008,now the present % required are given under...

·       For form 24q (etds return for salary mandatory pan limit will be 95% increased from 90%

·       For Form 26q and form 27eq(e-TCS) mandatory pan limit will be 85% increased from 70% earlier.

but due to these minimum % pan ,its impossible for some deductor to file the return ,as the deductee has not either have a pan or has not submitted the same to the deductor or intimate the incorrect pan not accepted by fvu..so many return are laying pending specially in case of small return where in absolute term there is only 2-3 pan are missing but as % they are 20-30 % ...I have also suggested in these cases to fill wrong pan and then revise the return latar on ,which seems to be not logically right to many but we have no option at that time and no official word on this issue was existed but now on 11 august2008 some official words are given on tin-nsdl site and i have reproduced the notice here under.Though this notice has not bearing the stamp of issuing authority but as it has been issued on NSDL website which is official site for e management of taxes by department ,so it is as good as a circular issued by CBDT.(feed reader u have to visit the blog to read the notice)

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Procedure for filing TDS returns with insufficient deductee PAN
 
As per instructions issued by the Central Board of Direct Taxes (CBDT), it is mandatory for deductors to file TDS/TCS statements with a threshold limit of Permanent Account Number (PAN) of deductees. To facilitate deductors who face problem in filing TDS returns because of insufficiency of PAN of the deductees and also to accommodate the deductees who have intimated their PAN, the Income Tax Department (ITD) has specified the following procedure for filing TDS/TCS returns:
 
·       Deductors can file a return containing deductee records which meets the specified threshold limit of PAN quoting, i.e., a deductor can file a return containing deductee details who have provided valid PAN. It can subsequently file a correction return with details of remaining deductees.

E.g. as below:
·       Suppose a challan payment of Rs.1,00,000/- has been made for non-salary TDS against 100 deductees each with TDS of Rs.1,000/-. Under the existing procedure the deductor will have to quote at least 85 PAN failing which his return will be rejected.

·       If there are only 50 deductees whose PAN is available and the deductor attempts to file a return with details of 100 deductees with PAN of only 50 deductees, the return will automatically be rejected at present.

·       However, if he files a return with challan amount of Rs. 1,00,000/- and with details of 50 deductees with PAN, with deductee total of Rs.50,000/-, the return will be accepted. It means the deductor can furnish the details relating to such deductees whose PANs are available.

·       The deductor can later file correction returns with other details of remaining deductees with the same challan details, i.e., the challan amount should be the amount deposited (in this case Rs. 1,00,000/-).

·       The return will be accepted so long as the TDS total of incremental deductees is less than or equal to the balance of Rs.50,000/-.

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From this notice, it is very much clear that we should go for incomplete return and give the deductee detail as much as we can give,and wait for balance information ,and as soon as we have all the party /dseductee's pan in our hand revise the etds return. This issue is very beneficial to many but this will not help the tax people to implement the minimum pan % condition in etds return as people tend to give half information and will reluctant to revise the return .but for genuine cases its a relief which is necessary.

I have some point regarding the new instruction

·       In some cases its will create a very funny situation suppose if a tds return has only one deductee and that's pan is also not available that as per direction above person will fill only challan detail and no deductee detail will be filled.

·       Person who's return has been accepted once without full detail will be relectant to file the revise return.

·       If person is not able to collect the pan details of all the assessee with in the assessment year ,in that case can he revise the return after the assessment year.

·       In my opinion its better to have a some information rather than nil information means earlier if persons pan is missing ,in etds return we are giving name address etc of the deductee in etds return by which Assessing officer can verify the tax through etds return and can give due credit of tax deducted in assessment of the deductee ,now the AO has no record of those person who has not submitted their pan to the deductor

Overall I can say it is good step or we can say a relief but in my opinion it should be temporary so that time schedule for discontinuation of TDS certificate may be met and we can live and progress further in e-management of taxes.