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QUESTIONS & ANSWERS
Differences in TDS compliance by banks
It is not possible in the computer age for bank staff to attend to individual cases in obtaining Form 15G or 15H or help the depositors when they fail to get credit.
This is with reference to the query regarding the time for filing declaration in Form No. 15H or 15G as the case may be in The Hindu dated March 9, 2009. It is a well known fact that many of the financial institutions, which accept deposits, especially banks, are not discharging their responsibilities expected of them by the Income-tax Act, 1961, as regards tax deduction at source (TDS). Though TDS is duly paid to the credit of the Central Government on or before the due dates, deficiencies are usually noticed by the auditors. They are: deduction of tax at source; filing of eTDS returns at the proper time; obtaining declaration in Form No. 15H or 15G; filing of declarations with the Commissioner of Income Tax at the appropriate time and issuing incomplete tax deduction certificates.
It should be noted that the Certificate of TDS in Form N0. 16A will be issued in full form with all particulars duly filled in. The latest form requires that the date of filing of eTDS return and the acknowledgement number be given in the certificate itself. But many banks use the old forms and not even furnish the PAN number of the deductee in the certificate. The forms are totally incomplete and the deductee may have his refund denied. The deductor institutions are required to indicate the PAN of the deductee in the eTDS returns so that the credit of tax duly finds a place in the annual tax statement, which is going to be an ultimate proof for the assessee being extended credit for the TDS. Any defect in the statement in electronic form will lose credit for the tax deductor. It is not possible in the computer age for bank staff to attend to individual cases in obtaining Form 15G or 15H or help the depositors when they fail to get credit. It is for the depositors to take timely action and for bank staff to promptly deal with complaints. You may publish the above information as to how banks operate.
The welcome clarification from G. Suryanarayanan, chartered accountant, Kumbakonam, brings to light the practice of TDS operations requiring enlightenment of not merely the readers but more importantly the personnel in banks. There is need for the Income-tax Department itself to undertake training of the deductors as to the responsibilities of banks and other major deductors, since tax credit will no longer be based on TDS certificates, but based on electronic returns filed by the bank disclosing Permanent Account Number (PAN) and the amount of tax deducted.
S. RAJARATNAM
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