It happens while filing TDS return every quarter….Sometimes few entries are missed, details of all TDS payments not mentioned….For such errors, revision facility is provided….So why this write up…
In case wrong PAN number is quoted in the return, then revision is restricted of that PAN number just to four characters...But what if by typing error, more than 4 characters get wrongly typed….In such a case, revision is not permitted….Now, will it amount to non quoting of PAN by the deductee?? Will TDS have to be deducted @20% on such payment??
A quick reminder: As per Section 206AA of the Act, in case PAN is wrongly quoted, then it will amount to non quoting of PAN...And in case of non quoting, TDS has to be deducted @ 20% instead of normal applicable rate…
So, is there any remedy in store for us??
Yupe…..Various judgements have held that unintentional quoting of wrong PAN will not attract the provisions of Section 206AA of the Act…
Recently in the case of Purnima Advertising Agency Ltd also, Gujrat HC upheld the same view...In this case, the assessee wrongly entered PAN of one of the deductee….TDS @2% was deducted in name of the deductee….During assessment proceedings, A.O contented that since PAN has been wrongly mentioned, it will amount of non quoting of PAN...Consequently balance TDS @18% was demanded along with interest….
Gujrat HC held that it is wholly illogical to limit corrections to only 2 alpha characters and to 2 numeric characters. Not permitting the assessee to correct the PAN of the deductee due to such self imposed correction restrictions of the department is not acceptable. Thus corrected TDS statement filed by the assessee be accepted.
Other Judgements in which similar view was adopted by the judiciary:
In the case of ONGC, Ahmedabad Tribunal held that unintentional quoting of wrong PAN will not attract provisions of Section 206AA as inadvertent error may crop up in any of the task undertaken. It was not intentional on part of ONGC to mention wrong PAN in the return. Also correct PAN was submitted to it by the deductee. It was just a typographical/mechanical error by ONGC while submitting the return.
Further in the case of Skypack India Private Ltd., Delhi Tribunal held that inadvertent error in submitting correct PAN may have resulted in the infraction of law, but the default is technical and venial. So revision of return by correction of PAN number be allowed.
Lastly, P&H HC in the case of Superintendent of Police held that no penalty be leviable for quoting the wrong PAN since the taxpayer had rectified the mistake by furnishing correct PAN….
In conclusion, these guidelines of TRACES restricting the revision of PAN number upto 4 characters needs revision. It can be like restricting the revision of whole PAN be allowed without any limit on characters, say upto two times....
Still, these judgements will be helpful in all those cases where TDS returns are not being allowed to be revised due to wrong quoting of PAN….