TDS JUSTIFICATION REPORT

Ensure the downloaded file is unzipped properly using an extraction tool and viewed using the official TRACES Justification Report Viewer utility rather than attempting to open it directly as a standard spreadsheet.

I think in new traces the downloaded file is excel file, if not kindly guide from where to get the extraction tool.

TDS Justification Report is a TRACES report that explains WHY a demand was raised on your TDS return. It breaks down the demand into three components:

1. INTEREST U/S 201(1A): Two types. Late deduction interest at 1% per month from the date TDS was deductible to the date it was actually deducted. Late deposit interest at 1.5% per month from the date of deduction to the date of deposit.

2. LATE FILING FEE U/S 234E: Rs. 200 per day from the due date of the TDS return to the actual filing date, subject to a maximum of the total TDS amount.

3. SHORT DEDUCTION: Difference between TDS that should have been deducted as per the department records versus what was actually deducted and remitted.

HOW TO DOWNLOAD THE REPORT:
Login to TRACES, go to Statements/Payments, select Justification Report, pick your form type (24Q/26Q/27Q) and quarter. Download the ZIP and open it with the Justification Report utility from the TRACES downloads section.

WHAT TO DO AFTER READING IT:
- If the interest demand is correct, pay via ITNS 281 challan (minor head 400) and tag the challan in a TDS correction statement
- If short deduction is shown but was actually correct, file a correction on TRACES with revised deductee details to rectify the mismatch

This [TDS demand and correction guide](https://taxgarden.in/blog/tds-not-showing-26as-mismatch-fix-india-2026) covers the TRACES correction steps in detail.

this process was used in old traces, in new traces direct a excel file is being downloaded