No.
275/29/2014-IT-(B)
Government
of India
Ministry
of Finance
Department
of Revenue
Central
Board of Direct Taxes
Dated New Delhi, the 1st June,
2015
To,
The CCsIT (CCA)
Subject: Non-deposit of Tax Deducted
at Source – regarding. Sir/Madam,
Grievances have been received by the
Board from many taxpayers that in their cases the deductor has deducted tax at
source from payments made to them in accordance with the provisions of
Chapter-XVII of the Income-tax Act, 1961 (hereafter ‘the Act’) but has failed
to deposit the same into the Government account leading to denial of credit of
such deduction of tax to these taxpayers and consequent raising of demand.
2. As per Section 199 of the Act
credit of Tax Deducted at Source is given to the person only if it is paid to
the Central Government Account. However, as per Section 205 of the Act the
assessee shall not be called upon to pay the tax to the extent tax has been
deducted from his income where the tax is deductible at source under the
provisions of Chapter- XVII. Thus the Act puts a bar on direct demand against
the assessee in such cases and the demand on account of tax credit mismatch
cannot be enforced coercively.
3. This may be brought to the notice
of all the assessing officers in your region so that if the facts of the case
so justify, the assessees are not put at any inconvenience on account of
default of deposit of tax into the Government account by the deductor.
4. This issues with the approval of
Chairperson, CBDT.
Yours faithfully
(Sandeep Singh)
Under Secretary to the Govt. of
India
