This discussion clarifies how to handle TDS returns related to interest and penalties. While some thought it was filed via TRACES, it's confirmed that TDS returns themselves are not filed for interest and penalties. Instead, these amounts should be entered in the interest or penalty columns within a TDS correction statement. This method correctly addresses the demand without needing to file separate returns for these charges.
If the interest is for particular Deductee or particular section then right way is to enter the amounts in interest or penalty columns in Tds correction statement ..
Need not use traces ..
Tds correction statement automatically nullify the demand
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