INCOME TAX thetaxtalk MECHANISM TO RECTIFY THE ERRORS

“MECHANISM TO RECTIFY THE ERRORS IN INCOME TAX CHALLAN”

22nd September 2014

INCOME TAX

Query 1]

I am government employee. My pay revision was due on Apr-2013. But actual pay revision happened on July-2014. I will be received arrears in four installments (Sep-14, Dec-14, Apr-15, Aug-15). Can I claim this arrears income in last financial year income? I have already filled last financial year return. [Sandeep Gajbhiye- syg6147@gmail.com]

Opinion:

Salary income is chargeable to tax either on “due” basis or on “receipt” basis, whichever is earlier. Arrears salary paid is taxable as Salary income only. Salary, in your case, has actually accrued & due in July-2014. Resultantly, the amount would be taxable in the FY 2014-15 (AY 2015-16).

Query 2]

I have submitted self assessment tax of Rs. 5,000/- in the State bank of India, Jatpura gate branch, Chandrapur bank (BSR code 0004831) by filling Callahan No. 280 Dated 12/09/2014, Serial No. 35. While submitting money to bank, cashier replied that his system is not accepting tax for the assessment year 2015-16 so he changed the assessment year as 2014-15 on Challan and made necessary entries. On counter slip, it appears as tax deposited for AY 2014-15. My question is, whether there is any mistake while depositing tax and what I have to do as tax deposited is for AY 2014-15 instead of AY 2015-16 while filing return? Whether I have to make any correction regarding this, now or subsequently? Please help me out. [parmanandtekade@yahoo.co.in]

Opinion:

Before filing income tax Return, taxpayer has to compute the tax after reducing the amount of TDS & Advance tax. The difference between the Gross Tax & TDS+TCS+Advance tax is normally referred to as the “Self Assessment Tax (SAT)”. Self assessment tax is normally paid at the time of filing income tax return. SAT can be paid after the end of the relevant financial year only and not before.

In your case, it appears that you intend to make the advance tax payment & not SAT for the AY 2015-16. Since the cashier might be putting a tick mark against the self assessment tax, the challan might not have been accepted as the SAT for the AY 2015-16 can be done only on or after 01.04.2015.

If the payment of Rs. 5,000/- as mentioned is of advance tax, you can carry out two correction i.e., correction in the “Type of payment” by showing tax as “Advance Tax” and correction in assessment year as AY “2015-16”.

There are numerous instances where there is an error while making payment of Tax either electronically or manually. To rectify these errors, Income-Tax Department has issued new guidelines effective 01-09-2011 which allows Banks to correct physical challans only. For correction in electronic challans, request will have to be made to the concerned Assessing Officer. For general benefit, I am elaborating the procedure for correction in the tax challan.

a] Correction in physical challans:

Fields that can be corrected by bank:

Assessment Year
Major Head Code
Minor Head Code
TAN/PAN
Total Amount
Nature of payment (TDS Codes)

Time frame for correction request:

Request for correction has to be made within 7 days of deposit of challan for correction in PAN, TAN and Assessment Year
For Major Head, minor head and nature of payment, request can be made within 3 months of deposit of challan.

Remedy available after time frame is over:

– After lapse of time frame, request can be made to the Assessing Officer.

Time frame given to bank to carry out correction:

After receipt of request, bank must carry out the correction within 7 days.

Other conditions for correction:

Correction in name is not allow
Any combination of correction of Minor Head and Assessment Year together is not allow
PAN/TAN correction will be allow only when the name in the challan
matches with the name as per the new PAN/TAN.
The change of amount will be permit only on the condition that the amount so correct is not different from the amount actually receive by the bank and credit to Govt. Account.
For a single challan, correction is allow only once. However, where 1^st correction request is make only for amount, a 2nd correction request will be allow for correction in other fields.
There will be no partial acceptance of change correction request, i.e. either all the request changes will be allow, if they pass the validation, or no change will be allow, if any one of the request changes fails the validation test.

Procedure for requesting correction:

The tax-payer has to submit the request form for correction (in duplicate) to the concerned bank branch.
The tax-payer has to attach copy of original challan counterfoil.
In case of correction desire for challan in Form 280, 282, 283, the copy of PAN card is require to be attach.
In case of correction desire for payments make by a tax-payer (other than an individual), the original authorization with seal of the non-individual taxpayer is require to be attach with the request form.
A separate request form is to be submit for each challan.

B] Correction in Electronic Challans:

For correction in electronic challans and for correction after the time period for application to bank lapses in physical challans, a written request in prescribe format has to be make to the Assessing Officer. Assessing Officer has power to rectify the error, in bona fide cases, to enable credit of tax to assessee

Form of application to bank:

Income-tax department has given a format in which application can be make to the bank.

The form can be accesse at www.nareshjakhotia.blogspot.com or at

http://www.incometaxindia.gov.in/archive/LeftMenu_ChallanCorrectionMechanism_2682011.pdf