TDS deductors given relief for non deduction of TDS at higher rate for inoperative PANs

TDS/TCS deductors given relief for non deduction of TDS at higher rate for inoperative PANs

CBDT has issued Circular No. 6 of 2024 dated 23.04.2024 giving relief to TDS/TCS deductors for non deduction of TDS u/s 206AA / 206CC at higher rate for inoperative PANs.

As per CBDT Circular No. 3 of 2023 dated 28.03.2023, the following consequences related to deduction of TDS/TCS were provided in case of a PAN becoming inoperative due to non linkage with AAdhaar Number:

(i) where tax is deductible under Chapter XVII-B in case of such person, such tax shall be deducted at higher rate, in accordance with the provisions of section 206AA;

(ii) where tax is collectible at source under Chapter XVII-BB in case of such person, such tax shall be collected at higher rate, in accordance with the provisions of section 206CC

CBDT has modified the Circular No. 3 of 2023 to redressing the grievances faced by deductors/collectors who have collected TDS/TCS at normal rate but was required to deduct /collect at double the rate on account of PAN of the deductee being inoperative due to non linkage of such PAN with AAdhaar.

Now it has been provided that for the transactions entered into up to 31.03.2024 and in cases where PAN becomes operative (as a result of linkage with AAdhaar) on or before 31.05.2024, there shall be no liability on the deductor / collector to deduct/collect the tax under section 206AA/206CC at double the rate because of PAN being inoperative.

• No protective addition required when additions is confirmed in hands of searched person – ITAT
• Limitation u/s 34 of Arbitration Act commences on disposal of application u/s 33 by Arbitral Tribunal – SC
• Case remanded in absence of finding if disallowance u/s 40A(3) covered by Rule 6DD
• For investment in share capital, source of investment is outside the control of the investee company
• ICAI issues revised Code of Ethics (13th edition)- Applicable Dates