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No pan at time of credit but pan available today

Dipjyoti Majumdar (CA in service & CS. dipmaj@ rediffmail.com ) (3468 Points)

12 December 2011

Friends

We credited the account of payee in May 2011 and deducted tax at source @ 20% as the payee did not have a PAN. The net amount was released to payee in July 2011. Today he has approached the company for revising the quarterly TDS return as now he has a PAN.

What to do under the circumstances ?

Regards,

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4 Replies

satish kumar voleti (A.C.A., (ICWAI)) (1686 Points)
Replied 12 December 2011

Since the assessee has not mentioned the PAN, you would have deducted TDS from him with higher rate of 20%, since there was no PAN, there is no chance for you to file Efiling of TDS return for the 1st quarter as the PAN of the assessee is not available.

Since know the PAN is available so file revised TDS return in his PAN, if you have already deposited the deducted TDS with department.

If you have not deposited the TDS deducted from him with the department then give back the excess TDS deducted from to him.

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vishnupriya (CA Final) (1418 Points)
Replied 12 December 2011

No, Department does not entertain revising return in this type of cases. The Criteria of Sec 206AA is

"PAN at the time of payment"

this criteria has to be checked “During the Payment” and not falling under future assurances, TDS has to be determined. If an Employee / Party receive a payment that is eligible for TDS, and assures Deductor of giving the PAN in short while, then such case has to be considered for higher rate determination.

Please read in this below link:

https://www.saraltds.com/articles/pan-compulsory.php

CA Kiran Sutrave (CA) (428 Points)
Replied 29 December 2011

Agreed with Vishnupriya. If the person had approached Company before releasing the payment then there would have been no problem.

Since in your case payment was already done and on a later date he comes with PAN asking the Company to revise the Return is not acceptable by law and the Company should not entertain such payee. You can show the payee Section 206AA for his reference.