How to claim refund of tds deducted of a local body

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

09 August 2014 DEAR SIR,
I M WORKING IN A PSU BANK.I DEDUCTED TDS OF RS 100953/-@ 20%(SINCE PAN NO WAS NOT AVAILABLE) OF A LOCAL BODY i.e MAHANAGARPALIKA ON A FIXED DEPOSIT OF RS 50.00 LACS KEPT WITH US IN THE QTR 4 OF FIN YEAR 2012-13.

LATER I WAS TOLD THAT LOCAL BODIES ARE NOT LIABLE TO PAY TAX.I CONSULTED OUR CA TO WHOM WE HAD GIVEN THE TASK OF FILING ETDS.HE ASKED US TO FILE REVISED RETURN GIVING THE PAN NO OF THE LOCAL BODY AND TOLD THAT HE WILL TRY FOR CLAIMING REFUND.WE DID SO.THEN HE IS TELLING US THAT SINCE THE AMT HAS GONE TO THE PAN NO OF THE LOCAL BODY WE AS A BANKER ARE NOT ELIGIBLE FOR CLAIMING REFUND.

WE APPROACHED THE LOCAL BODY AND TOLD THEM THE PROBLEM.BY ISSUING THEM THE TDS CERTIFICATE WE ASKED THEM TO CLAIM THE REFUND.BUT THEY FLATLY REFUSED TO DO SO SAYING THAT THEY ARE NOT LIABLE TO PAY TAX AND SINCE THEY HAVE NO INCOME OR EXPENDITURE THEY NEVER FILE INCOME TAX RETURN AND HENCE CANNOT CLAIM THE REFUND. INSTEAD THEY ASKED US TO REFUND THEIR TDS AMT DEDUCTED.

I LODGED A COMPLAINT WITH INCOMETAX DEPARTMENT BUT THEIR REPLY WAS THE SAME AS THAT OF THE CA.THEY TOLD THAT IF WE HAD NOT FILED REVISED RETURN BY GIVING THE PAN NO THEN IT COULD HAVE BEEN POSSIBLE FOR US TO CLAIM THE REFUND SINCE THE AMOUNT WOULD HAVE BEEN IN THEIR SUSPENSE A/C.

AS A LAST SOURCE I M LOOKING FOR THE SOLUTION FROM EXPERTS. GIVE ME ANY POSSIBLE POSITIVE SOLUTION EITHER REFUND OR ADJUSTING THE AMOUNT IN OUR FUTURE TDS AMOUNT TO BE FILED.

WAITING FOR A QUICK FAVOURABLE REPLY.

REGARDS
BANKER

Nikhil Kaushik

Nikhil Kaushik (Expert)
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09 August 2014 unfortunately, both your CA and the Income-tax department are correct.

While it is correct that you have wrongly deducted the tax, there is nothing you can do now. The local body may not have filed the returns till now but to get the refund of these taxes, it will have to file ITR5.

one way of resolving this is to change the deductee details in the TDS return. This should normally result in transfer of credit from one deductee to another. Ask your CA to try this.

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