25 August 2014
I filed a TDS return for the Quarter 4 of F.Y 13-14 before the due date. there was a mistake in filing the return I took the challan no. of 3rd quarter of the same F.Y and the software accepted the same without showing any errors and the return was filed after the due date I received an intimation raising a demand for short payment and in 26AS a penalty U/s 234E has been levied which is exceptionally high than the TDS amount short paid. We tried to rectify the same by filing a correction statement but it is cancelled by the depatt. Please assist.
28 July 2025
Got it — here’s what’s going on and how you can fix it:
---
### Issue Summary:
* You filed the **Q4 TDS return** but mistakenly **used the challan number of Q3** while filing. * The return was accepted but after due date. * Because of this mismatch, **the system raised a demand for short payment** of TDS. * You received a **penalty under Section 234E**, which is a flat penalty for late filing (₹200 per day of delay). * When you filed a correction statement, it got **rejected/cancelled by the department** because the challan details and quarter details didn’t match.
---
### Why the problem happened:
* **Challan numbers are linked to specific quarters** in the system. Using a challan number from Q3 in Q4 return causes mismatch. * The system assumes the TDS for Q4 was not paid, raising demand & penalty. * The correction statement must have the correct challan details matching the quarter.
---
### How to rectify:
1. **Check your Challan details carefully:** Identify the correct challan number(s) for the **actual payment made for Q4**. If you mistakenly referenced Q3 challan in Q4 return, find the actual Q4 challan.
2. **File a Correction Statement for Q4 with Correct Details:**
* Use the correct challan number and date that correspond to Q4 payments. * If you did not pay TDS for Q4 earlier, deposit the correct amount with interest and penalty, get a new challan, and use this in correction. * Correction statements must be filed **within 1 year from the due date** of the original return.
3. **If challan used is wrong and payment was made in previous quarter:**
* You may need to **file a correction statement for Q3** to include the challan details properly. * Or file a refund claim for wrongly paid TDS and deposit fresh TDS for Q4 with correct challan.
4. **Penalty under Section 234E:**
* This penalty is ₹200 per day for late filing beyond due date. * Unfortunately, this is a strict penalty and cannot be waived unless you can prove genuine hardship or there is an error on the department's side. * If you file the correction return promptly, further penalty will be avoided.
5. **Contact TIN Facilitation Center or your Chartered Accountant:**
* They can assist in re-filing correction with correct details and submitting rectification requests. * You can also file a **Rectification Request** online under Section 154 if you believe penalty is wrongly levied.
---
### Important Notes:
* Always double-check challan numbers, dates, and TDS amounts before filing returns. * Keep all challan receipts safely for future reference. * Use the latest FVU software and ensure it’s updated for all validations.
CAclubindia
