Tds deducted incorrectly

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Kunal (Querist)
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11 March 2013 I hold a family pension account with a nationalized bank. For the FY 2010-11, the bank deducted a TDS of Rs.40000/-(approx.). When I approached the bank, I was told that Pension accounts are subject to TDS and hence bank has deducted the TDS rightfully. My contention was that since it is a family pension account, it is not subject to TDS as Family pension is considered as "income from other sources". With this proposition, I approached the Ombudsman and the Ombudsman upheld my argument partly and directed the bank to pay (only) the interest on the amount of TDS deducted. The interest amount was paid from the date of deduction of TDS till the date of judgment by Ombudsman. However, the Ombudsman also stated that the issue of TDS is outside the ambit of the clauses mention under the Banking Ombudsman Scheme (BOS) and hence asked me to approach Consumer Redressal forum.
I was reading the Income tax department’s official document on TDS where I came across 2 circulars:
1. Circular no. 285
2. CIRCULAR NO. 2/2011 [F.NO. 385/25/2010-IT(B)], DATED 27-4-2011
Both the circulars talk about ‘Refund of TDS’ by the IT authorities to the deductor (in this case, the Bank).
I would want to know if (on the basis of either or both the circulars) I can ask the bank to file a claim to the Assessing officer for the refund of TDS. (as the TDS applicable is nil and TDS deducted is Rs.40000).
I approached a few CAs and most of them found this case complicated.
Will appreciate if the experts could help me out with their valuable inputs.
Thanks.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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12 March 2013 Dear Kunal,

We can appreciate the efforts made here.

But instead of wasting time and money in approaching banks and ombudsman, you can better just file ITR and claim the whole refund.

The TDS assessment and procedures are very slow and are often useless processes.

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Kunal

Kunal (Querist)
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23 March 2013 Thanks Nikhil.