Tds u/s 206aa

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

21 June 2012 In case employee does not furnish PAN and TDS is to be deducted u/s 206AA, then whether the benefit of deductions under chapter VI-A would be allowed to employee or 20% TDS rate to be applied on entire salary payment without any deduction under chapter VI-A.

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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21 June 2012 206AA is a stand alone section. Hence chapter VIA deduction can't be claimed.

Querist : Anonymous

Querist : Anonymous (Querist)

22 June 2012 but sir, example 1 given in CBDT cir no. 5 dated 16/08/2011 shows that chapter VI-A deductions are available even in case person does not furnish PAN and TDS deducted u/s 206AA @20%.

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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23 June 2012 That is true, but a circular can't override the act. Therefore, the sanctity of the circular leads to litigation.

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