Tds - remittance of late payment interest


11 November 2011

Dear Sir,

The TDS deducted from different parties under Section's 194C, 194I and 194J during September 2010 [Financial year 2010 - 2011] has been remitted / transferred through E-payment [tin-nsdl] to the Income Tax authorities on 08/10/2010, instead of, 07/10/2010, resulting in a delay of 1day. We have received a letter from the Income Tax authorities on 16/09/2011 charging us an amount of Rs.731-00 as late payment interest.
Till deposit of tax : 620-00
Till dt of generation of intimation: 111-00
Total : 731-00

I request your kind clarification on the following points :

1. The mode of payment of the amount of Rs.731-00.

a. Can the amount of Rs.731-00 be drawn through a demand draft in favour of "The Commissioner of Income Tax [TDS]" and forwarded to them through a letter.

b. Should the amount of Rs.731-00 be transferred only through E-payment. If so, the procedure to b followed for remittance. I had also contacted the Income Tax Department in Bangalore, they were not very sure of the procedure for payment.

They advised me to use the challan no./ITNS 281. In challan no.281, the type of payment - [200] TDS/TCS payable by Taxpayer, under the nature of payment - Section 201-1A and in the Banker's acknowledgement, the amount of Rs.731-00 to be entered under the head 'Interest'.

I had checked in www.tin-nsdl, used challan no.281 and under the nature of payment, there is no section 201-1A as such. Kindly guide me on the section to be used under the nature of payment and also the procedure for remittance of late payment interest of Rs.731-00

c. In case the amount of Rs.731-00 has to be remitted through E-payment, should I file quarterly returns for the same during the 3rd quarter ending 31st December 2011 of the financial year 2011-2012.

If so, should the amount of late payment interest accounted under the respective party's name from whom the TDS amount was recovered and remitted late by office.

I do agree that my query is a bit long, but I earnestly seek you good advice and guidance in solving this issue of remittance of late payment interest. I request you once again to kindly guide me on the procedure for remittance of late payment interest. Thanking you in anticipation.

Dhanaraj []

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