Frequently Asked Questions Service Tax

Frequently Asked Questions

• Which challans are to be used for payment of Excise and Service Tax?
• Where can one obtain these Challans?
• Can I Pay tax using the Old challan?
• What is Challan Identification Number (CIN) and what is its relevance?
• How will the acknowledgement stamp bearing the CIN look like?
• What should I do if I have misplaced my acknowledgement counterfoil?
• What would happen if I loose the paper token issued by the bank?

Which challans are to be used for payment of Excise and Service Tax?
Ans. Two new challan forms GAR-7 have been introduced by PR. CCA's office. From April 7, 2007, GAR-7 - Proforma for Central Excise Tax Payments is to be used for payment of Excise and GAR-7 - Proforma for Service Tax Payments is to be used for payment of Service Tax. These are single copy challans.
Where can one obtain these Challans?
Ans. Soft copies of these challans are available at NSDL (www.nsdl.co.in) and Central Board of Excise and Customs website (www.cbec.gov.in). Challans are also available with private vendors.
Can I pay tax using the old Challan?
Ans. From 1st April, 2007 it is mandatory to use challan no GAR-7 for payment of Excise and Service Tax.
What is Challan Identification Number (CIN) and what is its relevance?
Ans. Challan Identification Number (CIN) has three parts Seven digit BSR code of the bank branch where tax is deposited Date of Deposit (DD/MM/YY) of tax Serial Number of Challan CIN is stamped on the acknowledgement receipt to uniquely identify the tax payment. CIN has to be quoted in the return of income as a proof of payment. CIN is also to be quoted in any further enquiry. Therefore, you must ensure that CIN (comprising the above three parts) is stamped on the Challan by the bank. If not, immediately contact the bank manager and insist on CIN. The Reserve Bank of India has already passed an order dated April 1, 2004 making it compulsory for all tax collecting branches of banks to use a rubber stamp acknowledgement that carries CIN. A separate CIN is given for each challan deposited. If the Bank Manager is unable to resolve the issue, you should address your grievance to the Bank's Regional Manager and the Regional Office of Reserve Bank of India for redressal.
How will the acknowledgement stamp bearing the CIN look like?
Ans.The Acknowledgement stamp of the bank will contain the following information: Bank Branch Name BSR (7 digit) Deposit Date (DDMMYY) Serial No.
What should I do if I have misplaced my acknowledgement counterfoil?
Ans.Kindly approach the bank where you have deposited the tax and request them to issue you a certificate which contains your payment particulars including CIN.
What would happen if I loose the paper token issued by the bank?
Ans. Each bank follows its own procedure so you may contact the branch manager of the bank.

Guidelines for arrest and bail in relation to offences punishable under the Finance Act, 1994

Circular 171/6/2013-Service Tax
F.No. 137/47/2013-Service Tax
Government of India
Ministry of Finance
Department of Revenue
Central Board of Excise & Customs
Service Tax Wing
***
New Delhi, the 17th September, 2013
To,
All Chief Commissioners of Central Excise
All Chief Commissioners of Customs and Central Excise
All Directors General
All Commissioners of Service Tax
All Commissioners of Central Excise



Subject: Guidelines for arrest and bail in relation to offences punishable under the Finance Act, 1994


Section 103 (K) of the Finance Act, 2013 has introduced Sections 90 & 91 in the Finance Act, 1994, with effect from 10th May, 2013. In terms of section 90 of the Finance Act , 1994, as amended, offences under section 89(1) (ii) shall be cognizable and all other offences shall be non-cognizable and bailable. In terms of section 91(1) read with section 89(1) (i) and (ii) of the Finance Act, 1994, as amended, the power to arrest has been introduced in cases involving evasion of service tax covered under section 89(1) (i) and (ii) of the Finance Act, 1994, as amended and the amount of service tax evaded exceeds rupees fifty lakh. In this context, the following points may be noted for strict compliance:-

1.2 The following cases are covered under section 89(1) (i):
1.2.1 where a person knowingly evades the payment of service tax, or
1.2.2 avails and utilizes credit of taxes or duty without actual receipt of taxable service or excisable goods either fully or partially in violation of the rules, or
1.2.3 maintains false books of accounts or fails to supply any information which he is required to supply or supplies false information,
and the amount of service tax involved is more than fifty lakh rupees.
In such cases, the Assistant Commissioner or the Deputy Commissioner shall, for the purpose of releasing an arrested person on bail or otherwise,have the same powers and be subject to the same provisions as an officer in-charge of a police station has, and is subject to, under Section 436 of the Code of Criminal Procedure, 1973( 2 of 1974). This is in terms of section 91(3) of the Finance Act, 1994, as amended.

1.3 The following cases are covered under section 89(1) (ii):
1.3.1 where a person has collected any amount exceeding fifty lakh rupees as service tax but fails to pay the amount as collected to the credit of the Central Government beyond a period of six months from the date on which such payment becomes due.
In such cases, after following the due procedure of arrest, the arrested person must be produced before the magistrate without unnecessary delay, and definitely within 24 hours. This is in terms of section 91(2) of the Finance Act, 1994, as amended. The magistrate will decide on whether or not to grant bail.

2.0 Conditions precedent

2.1 Since arrest impinges on the personal liberty of an individual, this power must be exercised carefully. The Finance Act 1994, as amended, has specified categories of offences in respect of which only powers of arrest may be exercised and these offences are covered under clause (i) or clause (ii) of sub-section (1) of section 89 of the Finance Act, 1994. Further, the Finance Act 1994 has also prescribed value limits of evasion of service taxexceeding Rs 50 lakh, for exercising the powers of arrest.

2.2 The legal stipulations in the Finance Act 1994 , as amended, contained in section 91 read with section 89 must be strictly adhered to. An officer of Central Excise not below the rank of Superintendent of Central Excise can carry out an arrest on being authorized by the Commissioner of Central Excise. To authorize the arrest the Commissioner should have reason to believe that the person proposed to be arrested has committed an offence specified in clause (i) or clause (ii) of sub-section (1) of section 89. The reason to believe must be based on credible material which will stand judicial scrutiny.

2.3 Apart from fulfilling the legal requirements, the need to ensure proper investigation, prevention of the possibility of tampering with evidence or intimidating or influencing witnesses and large amounts of service tax evaded are relevant factors before deciding to arrest a person.


3.0 Procedure for arrest

3.1 The provisions of the Code of Criminal Procedure 1973 (2 of 1974) relating to arrest and the procedure thereof must be adhered to . It is therefore advised that the Commissioner should ensure that all officers are fully familiar with the provisions of the Code of Criminal Procedure 1973 (2 of 1974).

3.2 There is no prescribed format for arrest memo but an arrest memo must be in compliance with the directions in D.K Basu vs State of West Bengal reported in 1997(1) SCC 416 ( see paragraph 35). The arrest memo should include:
3.2.1 brief facts of the case;
3.2.2 details of the person arrested;
3.2.3 gist of evidence against the person;
3.2.4 relevant section (s) of the Finance Act, 1994 or other laws attracted to the case and to the arrested person;
3.2.5 the grounds of arrest must be explained to the arrested person and this fact noted in the arrest memo;
3.2.6 a nominated person (as per the details provided by arrested person) of the arrested person should be informed immediately and this fact also may be mentioned in the arrest memo;
3.2.7 the date and time of arrest may be mentioned in the arrest memo and the arrest memo should be given to the person arrested under proper acknowledgment;
3.2.8 a separate arrest memo has to be made and provided to each individual/arrested person. This should particularly be kept in mind in the event that there are several arrests in a single case.

3.3 Further there are certain modalities that should be complied with at the time of arrest and pursuant to an arrest, which include the following:
3.3.1 A female should be arrested by or in the presence of a woman officer;
3.3.2 Medical examination of an arrested person should be conducted by a medical officer in the service of Central or State Governments and in case themedical officer is not available , by a registered medical practitioner, soon after the arrest is made. If an arrested person is a female then such an examination shall be made only by, or under supervision of a female medical officer , and in case the female medical officer is not available, by a female registered medical practitioner.

3.3.3 It shall be the duty of the person having the custody of an arrested person to take reasonable care of the health and safety of the arrested person.


4.0 Post arrest formalities

4.1 The procedure is separately outlined for the different categories as listed in section 89(1) (i) and (ii) of the Finance Act, 1994, as amended:

4.1.1 In cases covered under section 89(1) (i), the Assistant Commissioner or Deputy Commissioner is bound to release a person on bail against a bail bond. The bail conditions should be informed in writing to the arrested person and also informed on telephone to the nominated person of the person (s) arrested .The arrested person should be also allowed to talk to a nominated person. The conditions will relate to, inter alia, execution of a personal bail bond and one surety of like amount given by a local person of repute, appearance before the investigating officer when required and not leaving the country without informing the officer. The amount to be indicated in the personal bail bond and security will depend, inter alia, on the amount of tax involved.

4.1.2 If the conditions of the bail are fulfilled by the arrested person, he shall be released by the officer concerned on bail forthwith. However, only in cases where the conditions for granting bail are not fulfilled, the arrested person shall be produced before the appropriate Magistrate without unnecessary delay and within twenty-four (24) hours of arrest. The arrested person may be handed over to the nearest police station for his safe custody, within 24 hours, during the night under achallan, before he is produced before the Court.

4.2 In cases covered under section 89(1) (ii) and only in the event of circumstances preventing the production of the arrested person before a Magistrate without unnecessary delay, the arrested person may be handed over to nearest Police Station for his safe custody, within 24 hours, under a proper challan, and produced before the Magistrate on the next day, and the nominated person of the arrested person may be also informed accordingly.

4.3 Formats of the relevant documentation i.e. the Bail Offer Letter, the Bail Bond and the Challan for handing over to the police, in the Code of Criminal Procedure, 1973. ( 2 of 1974) may be followed.


4.4 Every Commissionerate should maintain a Bail Register which will have the details of the case, arrested person, bail amount, surety amount. The money/instruments/documents received as surety should be kept in safe custody. The money should be deposited in the treasury. The other instruments/documents should be kept in the custody of a single nominated officer. It should be ensured that the instruments/documents received as surety are kept valid till the bail is discharged.


5.0 Reporting System

5.1 A report on every person arrested should be sent to the jurisdictional Chief Commissioner with a copy to DGCEI (Headquarters) the same day or on the next day.

5.2 Chief Commissioners shall send a report on every arrest to the Zonal Member within 24 hours of the arrest giving such details as prescribed in the monthly report .To maintain an all India record of arrests made in service tax, a monthly report of all persons arrested in the Zone shall be sent by the Chief Commissioner to DGCEI (Headquarters), New Delhi, by the 5th of the succeeding month, in the following format:

Monthly Report on Persons Arrested in a Zone

S.No	Name, designation and age of arrested person	Date of arrest	Commissionerate	Name and Registration Number of Company	Amount of duty evaded	Role in evasion and nature of evidence collected
Total

Yours faithfully

(Rajeev Yadav)
Director (Service Tax)

Relaxations in Branch Authorisation Policy

RBI/2013-14/274 DBOD.No.BAPD.BC.54 /22.01.001/2013-14 September 19, 2013 All Domestic Scheduled Commercial Banks (excluding RRBs) Madam / Dear Sir Section 23 of the Banking Regulation Act, 1949 – Relaxations in Branch Authorisation Policy Please refer to Governor’s Statement on taking office on September 04, 2013 (extract enclosed - Annex 1) regarding the proposal to completely free bank branching for well managed domestic scheduled commercial banks in every part of the country subject to fulfilling certain inclusion criteria in underserved areas in proportion to their expansion in urban areas. 2. To enhance the penetration of banking in rural and semi-urban areas, domestic scheduled commercial banks (excluding RRBs) were permitted vide circulars DBOD.No.BL.BC.65/22.01.001/2009-10 dated December 1, 2009 andDBOD.No.BL.BC.60/22.01.001/2011-12 dated November 29, 2011, respectively, to open branches in Tier 2 to Tier 6 centres and in the rural, semi-urban and urban centres in North-Eastern States and Sikkim without having the need to take permission from Reserve Bank of India in each case, subject to reporting. 3. With the objective of further liberalising and rationalising the branch authorisation policy, the general permission to domestic scheduled commercial banks (other than RRBs) referred to in para 2 above is now extended to branches in Tier 1 centres also, subject to the following: a) At least 25 percent of the total number of branches opened during the financial year (excluding entitlement for branches in Tier 1 centres given by way of incentive as stated in para 4 below), must be opened in unbanked rural (Tier 5 and Tier 6) centres, i.e. centres which do not have a brick and mortar structure of any scheduled commercial bank for customer based banking transactions. b) The total number of branches opened in Tier 1 centres during the financial year (excluding entitlement for branches in Tier 1 centres given by way of incentive as stated in para 4 below) cannot exceed the total number of branches opened in Tier 2 to 6 centres and all centres in the North Eastern States and Sikkim. 4. As there is a continuing need for opening more branches in underbanked districts of underbanked States for ensuring more uniform spatial distribution, banks would be provided incentive for opening such branches. Accordingly, banks may open branches in Tier 1 centres, over and above their eligibility as defined at para 3 (a) and (b) above, that are equal to the number of branches opened in Tier 2 to Tier 6 centres of underbanked districts of underbanked States, excluding such of the rural branches opened in unbanked rural centres that may be located in the underbanked districts of underbanked States in compliance with the requirement as indicated in para 3 (a) above.  5. Banks have to ensure that all branches opened during a financial year are in compliance with the norms as stipulated above. In case a bank is unable to open all the branches it is eligible for in Tier 1 centres, as per paras 3 and 4 above, it may carry-over (open) these branches during subsequent two years. 6. Banks, which for some reason are unable to meet their obligations of opening branches in Tier 2 to 6 centres in aggregate, or in unbanked rural centres (Tiers 5 to 6 centres) during the financial year, must necessarily rectify the shortfall in the next financial year.  7. This general permission would be subject to compliance with the parameters stated in para 3 and 6 above as well as regulatory/supervisory comfort in respect of the individual banks. RBI would have the option to withhold the general permission now being granted to banks which fail to meet the above mentioned criteria along with imposing penal measures on banks which fail to meet the obligations at paras 3 and 6 above.  8. Detailed guidelines in this regard including reporting requirements and examples illustrating the above stipulations are being issued shortly. All other instructions will remain unchanged.Yours faithfully, (Prakash Chandra Sahoo) Chief General Manager

Clear all Pending Service Tax Registration Applications by 23.09.2013 : CBEC

Chief Commissioners of Central Excise and Customs Directed to take stock of all Pending Registration Applications for Service Tax and Ensure their Clearance by 23rd September, 2013

All the Chief Commissioners of Central Excise and Customs and Director Generals Service Tax/Systems of Central Board of Excise and Customs (CBEC) have been asked to take stock of all pending registration applications for service tax and ensure that they are cleared by 23rd September 2013. Earlier the Chief Commissioners were asked to closely monitor registration applications as pending applications represent blocked revenue. Some complaints have been received in the Ministry about delays in the processing of applications for new registrations.

Accordingly, these directions have been issued today to all the Chief Commissioners of Central Excise and Customs and Director Generals Service Tax/Systems concerned. They have been asked to send their report as per the prescribed format to the Director General Service Tax at Headquarters electronically by 23rd September, 2013 in this regard.

Punjab Government has levied an Annual Processing Fee which is to be paid in the month of October every year. The proof of the payment of such fee is to be submitted along with Quarterly Returns.

The following table contains the amount of fee payable by various dealers:

Serial No.	Category of Dealer		Amount of Processing Fee    (in Rupees)
1.	Dealers who have not filled returns during financial year 2012-13		1500
2.	Dealers whose gross turnover was nil during previous financial year		1500
3.	Dealers who have paid no tax and whose gross turnover is up-to-rupees –
	i	One Crore	1500
	ii	One Crore to Five Crore	2500
	iii	Five Crore to Ten Crore	3500
	Iv	Ten Crore and Above	5000
4.	All other Dealers		800

Salary Allowances and Exempted Allowances

Allowance is defined as a fixed quantity of money or other substance given regularly in addition to salary for meeting specific requirements of the employees. As a general rule, all allowances are to be included in the total income unless specifically exempted. Exemption in respect of following allowances is allowable to the extent mentioned against each :-

House Rent Allowance:- Provided that expenditure on rent is actually incurred, exemption available shall be the least of the following :

(i) HRA received.
(ii) Rent paid less 10% of salary.
(iii) 40% of Salary (50% in case of Mumbai, Chennai, Kolkata, Delhi) Salary here means Basic + Dearness Allowance, if dearness allowance is provided by the terms of employment.

Leave Travel Allowance: The amount actually incurred on performance of travel on leave to any

place in India by the shortest route to that place is exempt. This is subject to a maximum of the air economy fare or AC 1st Class fare (if journey is performed by mode other than air) by such route, provided that the exemption shall be available only in respect of two journeys performed in a block of 4 calendar years.

Certain allowances given by the employer to the employee are exempt u/s 10(14). All these exempt allowance aredetailed in Rule 2BB of Income-tax Rules and are briefly given below:

For the purpose of Section 10(14)(i), following allowances are exempt, subject to actual expenses incurred:

(i) Allowance granted to meet cost of travel on tour or on transfer.

(ii) Allowance granted on tour or journey in connection with transfer to meet the daily charges incurred by the employee.

(iii) Allowance granted to meet conveyance expenses incurred in performance of duty, provided no free conveyance is provided.

(iv) Allowance granted to meet expenses incurred on a helper engaged for performance of official duty.

(v) Academic, research or training allowance granted in educational or research institutions.

(vi) Allowance granted to meet expenditure on purchase/ maintenance of uniform for performance of official duty.

Under Section 10(14)(ii), the following allowances have been prescribed as exempt.

Type of Allowance	Amount exempt
(i) Special Compensatory Allowancefor hilly areas or high altitudeallowance or climate allowance.	Rs.800 common for various areas of North East, Hilly areas of UP, HP. & J&K and Rs. 7000 per month for Siachen area of J&K and Rs.300 common for all places at a height of 1000 mts or more other than the above places.
(ii) Border area allowance or remote area allowance or a difficult areaallowance or disturbed area allowance.	Various amounts ranging from Rs.200 per month to Rs.1300 per month are exempt for various areas specified in Rule 2BB.
(iii) Tribal area/Schedule area/Agency area allowance available in MP, Assam, UP., Karnataka, West Bengal, Bihar, Orissa, Tamilnadu, Tripura	Rs.200 per month.
(iv) Any allowance granted to an employee working in any transport system to meet his personal expenditureduring duty performed in the course of running of such transport from one place to another place.	70% of such allowance upto a maximum of Rs.6000 per month.

(v) Children education allowance.		Rs.100 per month per child upto a maximum 2 children.
(vi) Allowance granted to meet hostel expenditure on employee’s child.		Rs.300 per month per child upto a maximum two children.
(vii) Compensatory field areaallowance available in various areas of ArunachalPradesh, Manipur Sikkim, Nagaland, H.P., U.P. & J&K.		Rs.2600 per month.
(viii) Compensatory modified field areaallowance available in specified areas of Punjab, Rajsthan, Haryana, U.P., J&K, HP., West Bengal & North East.		Rs.1000 per month
(ix) Counter insurgency allowance to members of Armed Forces.		Rs.3900 Per month
(x) Transport Allowance granted to an employee to meet his expenditure for the purpose ofcommuting between the place of residence & duty.		Rs.800 per month.
(xi) Transport allowance granted to physically disabled employee for the purpose of commuting between place of duty and residence.		Rs.1600 per month.
(xii) Underground allowance granted to an employee working in under groundmines.	Rs.800 per month.
(xiii) Special allowance in the nature of high altitude allowance granted to members of the armed forces.	Rs. 1060 p.m. (for altitude of 9000-15000 ft.) Rs.1600 p.m. (for altitude above 15000 ft.)
(xiv) Any special allowance granted to the members of the armed forces in the nature of special compensatory highly active field area allowance	Rs. 4,200/- p.m.
(xv) Special allowance granted to members of armed forces in the nature of island duty allowance. (in Andaman & Nicobar & Lakshadweep Group of Islands)	Rs. 3,250/- p.m.

Punjab MLA, seven others booked in Rs 60-cr scam

Punjab MLA, seven others booked in Rs 60-cr scamKanchan Vasdev/TNS

Chandigarh, September 17
The Chandigarh Police today booked Congress MLA from Talwandi Sabo Jeet Mohinder Singh and seven others, including Sukhbir Singh Shergill, trustee of the Adesh Foundation which runs a number of education institutes in the state, and Gurdeep Singh, managing director of Fastway Transmissions and a partner in Jujhar Travels, in a multi-crore fraud case.

The fraud diaries  The Chandigarh Police had registered a case of forgery amounting to over Rs 130 crore against 13 accused, including Jatinder Singh Dua and Sukhbir Singh Shergill  The complainant, Raman Uppal, alleged that Shergill cheated him of crores of rupees during the opening of a company --- International Customer Related Management Services --- in Sector 9, Chandigarh  The FIR stated that Raman Uppal wanted to expand his business. He met Shergill, who along with Jatinder Singh Dua, purchased a plot in Phase VII of Mohali  The complainant wanted to purchase another building situated in Phase VIII of the Industrial Area. He decided to jointly fund and promote a private limited company to be incorporated under ICRMS  Ramesh handed over the paper work to Shergill and the company was eventually floated for purchasing the said plot. It was alleged that Shergill, in connivance with his family, made his brother-in-law as director of the company  It was alleged that the funds were misused blatantly and properties were purchased by all accused. A number of properties were bought by Dua in his name and those of his family members and nominees. The market value of these properties is over Rs 300 crore

In the dock  The FIR states the accused, including Congress MLA from Talwandi Sabo Jeet Mohinder Singh (pic), were booked for forgery of valuable security, creating false/fraudulent documents, money-laundering, harbouring absconders and cheating the complainant, Raman Uppal  The prime accused — the Shergill couple —who were on the run since February, were arrested from Bathinda in July. They were being allegedly sheltered by MLA Jeet Mohinder, who was travelling with the accused when the cops swooped on them  The FIR said the conspiracy in the case was hatched at the Chandigarh residence of the MLA

Cop took bribe to 'settle' case A sub-inspector in the Economic Offence Wing, Naveen Sharma, was caught red-handed by the CBI taking a bribe of Rs 5 lakh in September 2012. He had allegedly demanded Rs 10 lakh from Sukhbir Shergill for "settling" the case

The FIR, registered on the directions of Illaqa Magistrate Chandigarh, states the accused were booked for forgery of valuable security, creating false/fraudulent documents, money laundering, harbouring absconders in a scam of Rs 60 crore and cheating the complainant Raman Uppal of the company, International Customer Related Management Services Private Limited (ICRMS).

The Congress MLA expressed surprise over a case being slapped on him. "It has come as a shock for me. I have not seen the FIR. Nobody came to me for enquiry. All I can say is that the case is politically motivated," said Jeet Mohinder Singh.

Uppal has been fighting the case through ex-IAS officer Gurnihal Singh Pirzada. The Chandigarh Police, in its investigation report, said the scam would turn out to be more than Rs 60 crore.

Pirzada said the company had acquired land in Mullanpur village for a private developer and earned huge profits (over Rs 100 crore). He alleged the complainant was duped of crores of rupees while opening another company.

The case also hogged the headlines in July this year when the Chandigarh Police arrested Sukhbir Singh Shergill and his wife Gurbir Kaur Shergill from Bathinda. The FIR said the accused changed the directorship and shareholding of the company to hoodwink authorities and indulged in fraudulent transactions. They have been accused of putting up frontmen who had no means to run such a large company.

The nine-page FIR, which does not include details of previous cases lodged in the scam, lists the accused as Sukhbir Singh Shergill, resident of SAS Nagar, his wife Gurbir Kaur Shergill, MLA Jeet Mohinder Singh and Gurdeep Singh.

The remaining accused in the case are Ludhiana residents Narinder Singh, Rajdeep Singh and Brij Kishore Tiwari besides chartered accountant Kamal Kishore Gupta, a Delhi resident.

The FIR states the prime accused, the Shergill couple, who were on the run since February, were arrested from Bathinda in July. They were being allegedly sheltered by MLA Jeet Mohinder Singh Sidhu, who was travelling with the accused when the cops swooped on them.

The FIR said the conspiracy in the case was hatched at the Chandigarh residence of the MLA. The police in its investigations said it was shocking that the accused removed the existing directors - Jatinder Dua, Sagar Dua, Madan Singfh and Harshvinderpal Singh on June 25 -- and appointed two new directors Narinder Singh and Rajdeep Singh on July 15, just two days before the Shergills were arrested.

TDS payment on property and how to obtain form 16B and 26QB

I would like to run the readers through the TDS payment process and the steps to be taken to obtain Form 16B (for the deductor or buyer) and Form 26QB for the (seller or deductee).

Firstly one has to go to the following link:

https://onlineservices.tin.egov-nsdl.com/etaxnew/tdsnontds.jsp

Once this link is opened click on Form 26QB (Payment of TDS on sale of property).
Select (0021) in case of non corporate payer and 0020 in case of corporate payer.
On filling in the various details called for in that form, click on ‘Proceed’ at the bottom of the page, this will then take you to the next page, which will give you the option to select your bank.
Once you select the bank, then login using the normal online process for your bank.
Once the payment is made the bank will let you print challan 280 with a tick on (800), which is payment of TDS on sale of property.
Take a printout of the challan and keep the same for your records and for the builder/seller if required.

This is the first phase of the process. Once this is completed one has to wait for seven days for the details to be reflected on TRACES web site – https://www.tdscpc.gov.in/. As a first time user, you will have to register on this website. Once you register whether as seller or buyer, you will be able to obtain the Form 16B or 26QB which has been approved and is reflected against your PAN in your Form 26AS.

Check Form 26 AS after seven days and you will notice that the payment you had effected against TDS on sale of property is reflected in Part F of the Form 26 AS under ‘Details of Tax Deducted at Source on Sale of Immoveable Property u/s 194(IA) [For Buyer of Property]. This will give you details such as the TDS certificate number (generated by TRACES), name of deductee, PAN of deductee, acknowledgement number, total transaction amount, transaction date, TDS deposited, date of deposit, status of booking and date of booking.

Once the payment is reflected in 26AS as above, you will have to go to the TRACES again. Login to the website, and click on ‘Downloads’ tab. In the dropdown menu click on ‘requested downloads’. If no application has been made you will be asked to make a request for download, here fill in the acknowledgment number (nine digit number) which is reflected on Form 26AS Part F as mentioned above. Once this is done, you will be able to view the status of your application, which generates anapplication request number.

Within a couple of hours, the application gets processed and you will be able to view your Form 16B by putting in the request number which you have obtained. You can take a printout of the same for your records as well as for handing over to the seller of the property. A similar process has to be followed by the seller to obtain form 26QB.

The entire process is system driven and works very smoothly.

TDS on Property

As per Finance Bill of 2013, TDS is applicable on sale of immoveable property wherein the sale consideration of the property exceeds or is equal to Rs 50,00,000 (Rupees Fifty Lakhs). Sec 194 IA of the Income Tax Act, 1961 states that for all transactions with effect from June 1, 2013, Tax @ 1% should be deducted by the purchaser of the property at the time of making payment of sale consideration. Tax so deducted should be deposited to the Government Account through any of the authorised bank branches.

Facility for furnishing information regarding the transaction of sale of immoveable property and payment of TDS thereof is available on this website.

Detailed procedure, user friendly e-tutorial, list of Bank branches authorised to accept TDS andFrequently Asked Questions (FAQs) are available on this website for reference.

Points to be remembered by the Purchaser of the Property:
Deduct tax @ 1% from the sale consideration.
Collect the Permanent Account Number (PAN) of the Seller and verify the same with the Original PAN card.
PAN of seller as well as Purchaser should be mandatorily furnished in the online Form for furnishing information regarding the sale transaction.
Do not commit any error in quoting the PAN or other details in the online Form as there is no online mechanism for rectification of errors. For the purpose of rectification you are required to contact Income Tax Department.

Points to be remembered by the Seller of the Property:
Provide your PAN to the Purchaser for furnishing information regarding TDS to the Income TaxDepartment.
Verify deposit of taxes deducted by the Purchaser in your Form 26AS Annual Tax Statement.

What is TDS on property?

The Finance Bill 2013 has proposed that purchaser of an immovable property (other than rural agricultural land) worth Rs 50 lakh or more is required to pay withholding tax at the rate of 1% from the consideration payable to a resident transferor

Who is responsible to deduct the TDS on sale of Property?

According to rules in respect of tax deducted at source, buyer of the property would have to deduct the TDS and deposit the same in Government treasury.

I am Buyer, do I required to procure TAN to report the TDS on sale of Property?

Buyer or Purchaser of the property is not required to procure Tax Deduction Account Number (TAN). The Buyer is required quote his or her PAN and sellers PAN.

What if I don’t have the PAN of the seller is it Mandatory?

PAN of the seller is mandatory. The same may be acquired from the Seller before effecting the transaction.

How can I use this facility to pay TDS on sale of Property?

The Buyer of the property (deductor of tax) has to furnish information regarding the transaction online on the TIN website. After successfully providing details of transaction deductor can:
Either make the payment online (through e-tax payment option) immediately;
Or make the payment subsequently through e-tax payment option (net-banking account) or by visiting any of the authorized Bank branches. However, such bank branches will make e-payment without digitization of any challan. The bank will get the challan details from the online form filled on www.tin-nsdl.com

If I encounter any error on NSDL site while entering the online form details what should I do?

If any problem is encountered at the NSDL website while entering details in the online form then contact the TIN Call Center at 020 – 27218080 or write to us at tininfo@nsdl.co.in (Please indicate the subject of the mail as Online Payment of Direct Tax).

PAYMENT THROUGH e-TAX PAYMENT OPTION IMMEDIATELY

What is the procedure for furnishing TDS through the e-tax payment option immediately after providing the transaction details?

E-Payment facilitates payment of taxes online by taxpayers. To avail this facility the taxpayer is required to have a net-banking account with any of the Authorized Banks. Please follow the steps as under to pay tax online:-

Step 1

a) Log on to NSDL-TIN website (www.tin-nsdl.com).
b) Click on the option “Furnish TDS on property”.
c) Select Form for Payment of TDS on purchase of Property.

Step 2

After selecting the form you will be directed to the screen for entering certain information.

Example:-

a) Permanent Account Number (PAN) of Property Purchaser and Seller.
b) Address of the Purchaser, Seller as well as the Property being purchased
c) Financial Year during which the Purchase has been made
d) Major Head Code – To indicate the type of tax applicable viz; Tax on companies/Tax on other than companies
e) Value of Property
f) Date of agreement/booking
g) Amount Paid/credited (Transaction amount)
h) Rate of TDS
i) TDS Amount
j) Dates of payment/credit, deduction
k) Select the option for “Payment of taxes immediately”

It is important to ensure that PAN of Buyer and Seller are correctly mentioned in the form. There is no online mechanism for subsequent rectification. Deductor will have to approach the Assessing Officer or CPC-TDS for rectification of errors.

Step 3

After entering all the above detail, click on PROCEED button. The system will check the validity of PAN. In case PAN is not available in the database of the Income Tax Department then you cannot proceed with the payment of tax.

If PAN is available then TIN system will display the contents you have entered along with the “Name” appearing in the ITD database with respect the PAN entered by you.

Step 4

You can now verify the details entered by you. In case you have made a mistake in data entry, click on “EDIT” to correct the same. If all the detail and name as per ITD is correct, click on “SUBMIT” button. Nine digit alpha numeric ACK no. will be generated and you will be directed to the net-banking site provided by you.

Please be informed that the name and status of PAN is as per the ITD PAN Master. You are required to verify the name before making payment. In case any discrepancy is observed, please confirm the PAN entered by you. Any change required in the name displayed as per the PAN Master can be updated by filling up the relevant change request forms for PAN. If the name is correct, then click on “Confirm”

Step 5

After confirmation an option will be provided for submitting to Bank. On clicking on Submit to Bank deductor will have to login to the net-banking site with the user ID/ password provided by the bank for net-banking purpose and enter payment details at the bank site.

On successful payment a challan counterfoil will be displayed containing CIN, payment details and bank name through which e-payment has been made. This counterfoil is proof of payment being made.

How do I know whether my bank provides this facility?

To avail this facility the taxpayer is required to have a net-banking account with any of the Authorized Banks. List of Authorized Banks is available at the TIN website in the link

What is the procedure after being directed to the net banking site of the bank?

TIN system will direct you to net-banking facility of your bank. You will have to log on to the net banking site of your bank using your login ID and password/PIN provided by the bank. The particulars entered by you at TIN website will be displayed again.

You will now be required to enter the amount of tax you intend to pay and also select your bank account number from where you intend to pay the tax. After verifying the correctness, you can proceed with confirming the payment.

What will happen after I confirm the payment of tax at my bank’s site?

Your bank will process the transaction online by debiting the bank account indicated by you and generate a printable acknowledgment indicating the Challan Identification Number (CIN). You can verify the status of the challan in the “Challan Status Inquiry” at NSDL-TIN website using CIN after a week, after making payment.

What is the timing for making payment through internet?

You will have to check the net-banking webpage of your bank’s website for this information.

Whom should I contact if the counterfoil containing the CIN is not displayed on completion of the transaction and if I want duplicate counterfoil?

Your Bank provides facility for re-generation of electronic challan counterfoil kindly check the Bank website, if not then you should contact your bank request them for duplicate challan counterfoil.

If any problem encountered while entering the financial details at the net-banking webpage of your bank, then you should contact your bank for assistance.

PAYMENT OF TDS SUBSEQUENTLY

What is the procedure for paying the TDS amount into the Bank subsequently, i.e. not immediately after furnishing the purchase transaction details online?

Using this facility deductor (Buyer) can furnish the details online and make the payment of taxes subsequently either through net-banking account or by visiting any of the authorized bank branches. Following are the steps to avail this facility:

Step 1

a) Log on to NSDL-TIN website (www.tin-nsdl.com).
b) Click on the option “Furnish TDS on property”.
c) Select Form for Payment of TDS on purchase of Property.

Step 2

After selecting the form you will be directed to the screen for entering certain information.

Example:-

a) Permanent Account Number (PAN) of Property Purchaser and Seller.
b) Address of the Purchaser, Seller as well as the Property being purchased
c) Financial Year during which the Purchase has been made
d) Major Head Code – To indicate the type of tax applicable viz; Tax on companies/Tax on other than companies
e) Value of Property
f) Date of agreement/booking
g) Amount Paid/credited (Transaction amount)
h) Rate of TDS
i) TDS Amount
j) Dates of payment/credit, deduction
k) Select the option for “Payment of taxes immediately”

It is important to ensure that PAN of Buyer and Seller are correctly mentioned in the form. There is no online mechanism for subsequent rectification. Deductor will have to approach the Assessing Officer or CPC-TDS for rectification of errors.

Step 3

After entering all the above detail, click on PROCEED button. The system will check the validity of PAN. In case PAN is not available in the database of the Income Tax Department then you cannot proceed with the payment of tax.

If PAN is available then TIN system will display the contents you have entered along with the “Name” appearing in the ITD database with respect the PAN entered by you.

Step 4

You can now verify the details entered by you. In case you have made a mistake in data entry, click on “EDIT” to correct the same. If all the detail and name as per ITD is correct, click on “SUBMIT”button. Nine digit alpha numeric ACK no. will be generated and you will be provided with an option to print an Acknowledgment slip.

Please be informed that the name and status of PAN is as per the ITD PAN Master. You are required to verify the name before making payment. In case any discrepancy is observed, please confirm the PAN entered by you. Any change required in the name displayed as per the PAN Master can be updated by filling up the relevant change request forms for PAN. If the name is correct, then click on “Confirm”.

Step 5

With the printout of the Acknowledgment slip, you may visit any of the authorized Bank branches to make the payment of TDS subsequently. The Bank will make the payment through its netbanking facility and provide you the Challan counterfoil as acknowledgment for payment of taxes. Based on the information in the Acknowledgment slip, the bank will make the payment only through net-banking facility by visiting tin-nsdl.com and entering the acknowledgement number duly generated by TIN for the statement already filled by the buyer in respect of that transaction.

In case you desire to make the payment through e-tax payment (netbanking account) subsequently, you may access the link ‘View/Payment of TDS on property” on the TIN website. On entering the details as per the acknowledgment slip, you will be provided an option to submit to the bank wherein you have to select the Bank through which you desire to make the payment. You will be taken to the netbanking login screen wherein you can make the payment online.

What do I do if I have misplaced the Acknowledgment slip for payment through the Bank branches?

You may access the access the link ‘View/Payment of TDS on property” on the TIN website. On entering the details as per the acknowledgment slip, you will be provided options to either Print the Acknowledgment Slip.

In case you desire to make an online payment, on the same screen option for Submit to the bank is provided wherein you have to select the Bank for payment. You will be taken to the netbanking login screen wherein you can make the payment online.

Which banks are Authorised to accept TDS Payment U/s. 194IA?

Authorized Banks:
Allahabad Bank
Andhra Bank
Axis Bank
Bank of Baroda
Bank of India
Bank of Maharashtra
Canara Bank
Central Bank of India
Corporation Bank
Dena Bank
HDFC Bank
ICICI Bank
IDBI Bank
Indian Bank
Indian Overseas Bank
Jammu & Kashmir Bank
Oriental Bank of Commerce
Punjab and Sind Bank
Punjab National Bank
State Bank of Bikaner & Jaipur
State Bank of Hyderabad
State Bank of India
State Bank of Mysore
State Bank of Patiala
State Bank of Travancore
Syndicate Bank
UCO Bank
Union Bank of India
United Bank of India
Vijaya Bank