Tds payment made to wrong TAN

https://incometaxindia.gov.in/Documents/challan-correction-mechanism-26082011.htm

1.   https://www.protean-tinpan.com/services/oltas/oltas-note.htm l

2.   https://learn.quicko.com/application-for-correction-change-in-tan-tin-nsdl

Yes, if TDS has been paid to a wrong TAN account, the bank can rectify the error from their end within 7 days (not 15 days) from the date of payment. The provision for this is given in Rule 128 of the Income Tax Rules, 1962. According to this rule, if any sum has been paid to the credit of the Central Government but has been credited to the wrong TAN account, the bank can rectify the error by transferring the sum to the correct TAN account within 7 days.

To initiate the process of rectification, the deductor needs to make a written request to the bank within 3 days of making the payment. The request should contain the following details:

The name and address of the deductor
The TAN of the deductor
The amount and date of payment
The TAN to which the payment was made erroneously
The correct TAN to which the payment should have been made
The bank will then verify the details and rectify the error within 7 days. However, it is important to note that this provision applies only to cases where the sum has been credited to a wrong TAN account belonging to the Central Government. If the payment has been made to an incorrect account belonging to a party other than the Central Government, the deductor will need to approach the concerned party for rectification.

How the correction actually works:

• Bank-level correction: for physical challans the bank can correct TAN or PAN within 7 days of deposit (not 15), and other fields such as AY, major head or minor head within 7 days. This is under the Challan Correction Mechanism (CBDT, 2011); OLTAS does not allow later TAN corrections by banks.

• After 7 days: apply to the jurisdictional TDS Assessing Officer for correction of TAN, with the challan copy, an indemnity, and confirmation from the wrong TAN holder that the challan has not been used. The AO corrects it in OLTAS.

• Online (e-Pay Tax) challans: the e-filing portal allows correction of AY, major head and minor head within the permitted window. TAN corrections still go through the AO.

• Until it is corrected:

– the challan shows as unconsumed under the wrong TAN

– your statement shows a short payment.

Avoid paying again unless the AO route is clearly delayed; interest under Sec 201(1A) runs on the shortfall.

• If you pay again to avoid interest, claim a refund of the wrong challan in Form 26B through the other TAN holder, or have it corrected.