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If i deposited cheque on due date, have i made late payment?

Rajesh Kothari (CEO) (74 Points)

28 August 2012  

We deposited cheque in State Bank of India on due date i.e., 7th Sept 2011. But, after filing E-Return, we have received a default saying we need to make interest on late payment.

My question here is:

Which date is taken as TDS deposit date when a payment is made by a cheque drawn on other bank a/c

a. date on which TDS receiving bank (SBI) receives payment from the other bank (saraswat bank)?

b. date on which TDS is deposited in receiving bank (SBI)?

Please see attached scanned copy of Bank Deposit Challan. Date of deposit is 7th Sept 2011. As per our bank statement SBI got credit from Saraswat bank on 9th Sept 2011 but they put a stamp of 16th Sept 2011 - as Challan Tender Date and put another stamp of 16-9-2011 with BSR code and serial no.57.

In TDS eReturn we have been forced to give deposit date as 16-9-2011 with BSR code & serial number. Due to this, they are asking for interest from us for late payment of TDS.

Is this a correct view taken by the Income tax dept? or Is it a new problem that has come-up due to Efiling of returns with attended automatic checking of payment details using CIN based verification by NSDL?

Only resolution to this issue seems to be that we need to ensure that receiving bank receives the payment on due date. So, we need to deposit cheque 9 days in advance (because it took SBI 9 days = 16 -7 to get the credit from Saraswat bank). Isn't this ridiculous situation?

What do you think or say?

 


 20 Replies

Vikky Vasvani (Executive -Accounts & Finance)   (321 Points)
Replied 28 August 2012

Dear Rajesh Ji,

 

First of all.... is your chq. was outstaion Chq.. if No. ... you should go to bank & tell him to give you date of deposit...... if we deposit chq on last day of due date... & if it is cleared ... then it is deemed to be paid within due date................... ..!

if this comes wrong ........your bank takes clearing . 9 days .. & you have to pay on evey 28th.... of the month... how it possible..............!!!!!!

go to bank ... tell him to give you rectified date...... of your submission date in Bank.....  make to use E-Payment to avoide such type of Prob...... Mostly SBI Bank's are doing this so that we are paying in HDFC Bank

Rajesh Kothari (CEO) (74 Points)
Replied 28 August 2012

It was a local cheque. In fact, both bancks are physically located within 100 meters. It is not possible for SBI to give a valid serial number (which will be verified by NSDL's Challan Status inquiry system) of 7the Sept. I think there should be clarification from Income tax dept on this and they should ask banks to mention 'Cheque Received Date' along with other 2 dates viz., Challan Tender Date and Received Date. In fact, I'm not sure what is the meaning of Received Date. Is it the date on which Income tax dept received the payment from State Bank? Why it took just 3 days against 9 days?

Aarush (Delhi) (1566 Points)
Replied 28 August 2012

Tender Date should be taken, in such cases bank used two types of stamps one for tender (when you deposit cheques) and another one is realisation stamp (when you account has been debited)

Stautotary auditors always take tender date and verify from bank statement ( 2 or 3 days gap will be valid for local cheques and 10 to 15 days gap for outstation cheques will be valied.)

U S Sharma (glidor@gmail.com) (21031 Points)
Replied 28 August 2012

match the cheque with your  bank statement, and then discuss the issue :)

Rajesh Kothari (CEO) (74 Points)
Replied 28 August 2012

We checked the bank statement. Amount is debited on 9th Sept i.e, after 2 days of deposit with SBI. Then how is that SBI has given Tender Date as 16th Sept? But, problem here is, even if we argue SBI can't change it in their records. Assuming that they change it to 9th Sept. Then also, it does not help because we have made late payment. What to do? Note: In my orginal post, I've given link to the image of Challan with stamps and its status on website (click on "attached" after question a. and b.) Sorry in spite of repeated tries I could not attach the file here. It just fails.

Aarush (Delhi) (1566 Points)
Replied 28 August 2012

Sir, as you said that cheuqe has realised on 09th Sep than its obvious that it was deposited on or before of 09th Sep , its little hard that you deposited it on 09th and its cleared on same date.

Send a letter official of SBI to offer you a seperate letter on tender date i.e. 07th Sep and attached copy of bank statement clear state that how its will be possible to mentioned 16 th Sep whereas cheque has realised on 09th Sep. (if they are not accepting write to RBI)

For TDS - revised your Tds return and write 07th Sep instead of 16 Sep.

Who forced to put 16th Sep in TDS return ?

 

Rajesh Kothari (CEO) (74 Points)
Replied 28 August 2012

If you see my original post above, we filled in TDS Challan with cheque on 7th Sept in SBI. The cheque got cleared on 9th Sept in our bank. SBI gave a stamp with Tender Date as 16th Sept with Serial no. When we filed the eTDS return (online) it asks for Bank code (BSR) and Serial no. and Tender Date. Here, in this case, Tender date is 16th Sept. So, if we enter 7th Setp as Tender Date it does not get validated by the online system developed by NSDL. Hence our revised return won't get accepted. Hope you get the point. So, we are in a fix, as 'default' is generated by the system. And this is not a isolated incident, same case is with all TDS payments done through cheque. Why should we pay interest for late payment?

U S Sharma (glidor@gmail.com) (21031 Points)
Replied 29 August 2012

Maybe the saraswat bank cleared the cheque on 9th, but redirected to sbi by late, ( as private banks >clearing house>nationalized bank channel does not work smooth) and if rece by sbi then, its pure fault by SBI staff who makes entries in NSDL site, they kept it pending for these days. also when its not done within 7th at NSDL it does not save you at all, coz after 7th the default is there, either 9th or 16th , but it is default. 

however once entered in NSDL it can not be rectified for such minor mistake, coz the efforts to be used to correct the same would take a long.

to overcome such situation in future, 1) pay well in advance 2) try to keep an SBI account for such purpose, so that same day your account is debited and posted to NDSL on same day.

 

Kamal Kumar (self employed) (62 Points)
Replied 29 August 2012

It is better to open a a/c in SBI bank.Earlier I used to have all my A.cs in Saraswat Bank. For tax paying a/cs , I have opened A/cs in SBI. Through this a/cs, I can apply for IPO (ASBA),pay Vat,PPF ,Advance Tax & Self Assessment Tax. It is very covenient now for me.You do not need to park funds in SBI a/c. It is only when ,need arise ,you can transfer funds from Saraswat to SBI.For your info,I have more than 50 a/cs in Saraswat Bank.Though,they offer high interest on Deposits,they are not yet offering on line transaction facility.

Rajesh Kothari (CEO) (74 Points)
Replied 29 August 2012

Thanks for all the suggestions. But, I notice that they are all for the future time. If system was manual, surely my TDS challan would have been accepted without any interest for late payment. Then, why should an ordinary citizen suffer financial loss due to faulty online tax reporting mechanism? What about defaults that have come from TDS dept? I meekly surrender and make all the interest payments? Is there no way we/ICAI/people can take up this isuse with NSDL / Income tax dept?

Hemchand Kohli (Accountant) (888 Points)
Replied 29 August 2012

As per my knowledge, you will have to pay interest, since Online TDS payment is madatory so 7th for succeding months is last date, it means amount of TDS should be credited in the govt accounts by 7th.

 

 

Dipjyoti Majumdar (CA in service & CS. dipmaj@ rediffmail.com )   (3414 Points)
Replied 29 August 2012

Mr. Rajesh Kothari

I appreciate your grievance. Yes, we are at the mercy of law makers. It is better to make TDS payments online which is compulsory for most of the assessees.

For example, most of the intimations/notices issued under section 200A for late deposit  / non deposit of TDS would invariably include interest on interest. But if you go the dept, the TDS AO and clrks say "it has been done by the system."

Regards,

Aarush (Delhi) (1566 Points)
Replied 30 August 2012

After reading case laws {shared by Hemchand} i have to say that there is no point to discuss further on this topic.. bank and income tax dept will never entertain such events :-(

 

Aarush (Delhi) (1566 Points)
Replied 30 August 2012

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