Monday, April 22, 2013

New Circular regarding issuance of TDS Form 16

CIRCULAR NO. 04/2013
F.No 275/34/2011-IT(B) 
Government of India 
Ministry of Finance 
Department of Revenue 
Central Board of Direct Taxes 
New Delhi, the 17th April, 2013 

Sub: Issuance of certificate for tax deducted at source in Form No. 16 in accordance with  the provisions of section 203 of the Income-tax Act, 1961 read with the Rule 31 of the  Income-tax Rules 1962 -- regarding 

1. Section 203 of the Income-tax Act 1961 (“the Act”) read with the Rule 31 of the Income-tax Rules 1962 (“the Rules”) stipulates furnishing of certificate of tax deduction at source (TDS) by  the deductor to the deductee specifying therein the prescribed particulars such as amount of TDS,  valid permanent account number (PAN) of the deductee, tax deduction and collection  account number (TAN) of the deductor, etc. The relevant form for such TDS certificate is Form  No. 16 in case of deduction under section 192 and Form No. 16A for deduction under any other  provision of Chapter XVII-B of the Act. TDS certificate in Form No. 16 is to be issued  annually whereas TDS certificate in Form No. 16A is to be issued quarterly. TDS  Certificate in Form No 16 as notified vide Notification No. 11/2013 dated 19.02.2013 has  two parts viz Part A and Part B (Annexure). Part A contains details of tax deduction and  deposit and Part B (Annexure) contains details of income. 

2. With a view to streamline the TDS procedures, including proper administration of the Act,  the Board had issued Circular No. 03/2011 dated 13.05.2011 and Circular No. 01/2012 dated  09.04.2012 making it mandatory for all deductors to issue TDS certificate in Form No. 16A after  generating and downloading the same from “TDS Reconciliation Analysis and Correction  Enabling System” or (Error! Hyperlink reference not valid., previously called TIN website. In exercise of powers under section 119 of the Act, the Board has  now decided as  following:- 

All deductors (including Government deductors who deposit TDS in the Central Government  Account through book entry) shall issue the Part A of Form No. 16, by generating and  subsequently downloading through TRACES Portal, in respect of all sums deducted on or after  the 1st day of April, 2012 under the provisions of section 192 of Chapter XVII-B. Part A of  Form No 16 shall have a unique TDS certificate number. 

The deductor, issuing the Part A of Form No. 16 by downloading it from the TRACES  Portal, shall, before issuing to the deductee authenticate the correctness of contents mentioned therein and verify the same either by using manual signature or by using digital  signature in accordance with sub-rule (6) of Rule 31. 

2.3 In other words, Part A of Form No. 16 shall be issued by all the deductors, only by  generating it through TRACES Portal and after duly authenticating and verifying it. 

2.4 ‘Part B (Annexure)’ of Form No. 16 shall be prepared by the deductor manually and  issued to the deductee after due authentication and verification alongwith the Part A of the Form  No. 16 stated above. 

2.5 Sub rule (3) of rule 31of the Rules sets the time limit for issuance of Form 16 by the  deductor to the employee. Currently, Form 16 should be issued by 31st May of the financial Year  immediately following the financial year in which income was paid and tax deducted. 

3.1 The Director General of Income-tax (Systems) shall specify the procedure, formats and  standards for the purpose of download of Part A of Form No. 16 from the TRACES Portal and  shall be responsible for the day-to-day administration in relation to the procedure, formats and  standards for download of Part A of Form No. 16 in electronic form.  

3.2 It is further clarified that Part A of Form No. 16 issued by the deductors in accordance with  this circular and as per the procedure, formats and standards specified by the Director General of  Income-tax (Systems) and containing Unique Identification Number shall only be treated as a  valid compliance to the issue of Part A of Form No. 16 for the purpose of section 203 of the Act  read with rule 31 of the Rules. 

4. Hindi version shall follow. 
(Anshu Prakash) 
Director (Budget) 
Central Board of Direct Taxes 
     Copy to: 
  1. The Chairperson, Members and all other officers of the CBDT of the rank of Under  Secretary and above 
  2. All Chief Commissioners of Income-tax (CCA) & All Directors General of Income-tax 
  3. The Director (PR, PP & OL), Mayur Bhawan, New Delhi for printing in the quarterly tax  bulletin and for circulation as per usual mailing list (100 copies) 
  4. The Comptroller and Auditor General of India (40 copies) 
  5. All Directors of Income Tax, New Delhi; 
  6. All CsIT (TDS) 
  7. The Director General of Income-tax, NADT, Nagpur 
  8. Guard file 

(Anshu Prakash) 
Director (Budget) 
Central Board of Direct Taxes

Form  16 from NSDL RPU 3.2 directly (Click Here)

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