23 January 2013
MES ( MilitarMES (Military Engineering Services) issues TDS certificates for the payment made to it's contractors.But many of their offices issues these certificates manually as they do not file e returns. So these TDS credits are not reflected on 26 AS. Also MES deducted much extra tax on payments by mistake. However they have given the certificate also for extra amount deducted by them. MES office says that they can not refund the extra tax wrongly deducted & advised us to claim this amount from income tax. So my question is 1) Whether income tax department will accept the TDS certificate issued by MES which is submitted by us along with IT returns filed by us? 2) what action IT department takes on MES if they do not file e returns & their TDS is not reflected on AS 26.I am really worried because we execute lot of MES contracts SunilPhansalkar
24 January 2013
You have good reason to be worried. The officers of the tax department have internal instructions to only give tax credit to the extent it is reflecting in the 26AS. The TDS Certificate may not be in the format but it is imperative that MES file their ETDS returns against your PAN so that the amount is reflected in the Form 26AS. 1. Income tax department will accept the TDS Certificate but they will not grant credit unless the same amounts are available in Form 26AS. Hence you need to speak to the FAO or DDO of MES and request him to file their ETDS returns.
2. The IT Department is required to levy penalty for failure in submitting returns. You can threaten the MES people that you will write to their AO or TDS officer.
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