During internal audit I came across an issue regarding Form-16A penalty. My question is how to know whether client has issued Form-16A on time & to all parties.
25 April 2016
It is very difficult to ensure whether all TDS Certificates have been issued and that too timely. Ever since the Department took over the issue of TDS Certificates, through TRACES, most companies download the Certificates and file them.
The payees also do not ask for TDS Certificates as ITRs are filed mostly online and in a few cases in paper form. But the ITR is not accompanied by any TDS Certificates, only the details are filled in the relevant section. The IT Department gives credit only if the deduction is reflected in the 26AS form not otherwise, so most parties don't even bother to collect the TDS Cetificates, if the deduction is correctly reflected in their 26AS Statement.
It is only when some payee complains or has a problem the question of hard copy of TDS Certificate being issued arises. Hence as internal auditor, one should ensure that the correct TDS is deducted, deposited and Form 26Q filed in time. This will automatically take care of the problem you faced. Further it should be ensured that your client has all the PAN numbers of all deductees, otherwise the quarterly return will not be confirmed and the deduction will not reflect in 26AS form.
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