Incorrect use of ITR form

Dear Sir/Madam, 

I am individual taxpayer working in a private sector. I used form 281 to taxes for AY2008 instead of 280. Quoted employer TAN in 281. IT sent arrear demand notice in 2011,Since the paid tax was not credited to my PAN account.  I sent request letter to AO in 2012 to transfer the tax paid from employer TAN and credit to my PAN account. But it was not done. Still there is demand uploaded in my account. Could you please help how to resolve this issue?  OR Should I pay outstanding arrear demand now( including accumulated interest? 

Regards

Ramamurthy