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.

• Empanelment of ICAI Exam observer for January 2027 Examinations. Last date: 20.11.2026
• No arrest under GST- Major decision of 57th Meeting of GST Council held on 8th October 2026
• Later SC ruling cannot render an act done in compliance of a court order a statutory default
• Interest payment on mobilisation advance to NHAI not liable to TDS u/s 194A
• Typographical error in turnover accepted during assessment not a mistake apparent from record