Pay Commission Arrears – CBDT's Pound of Flesh
The Babus are ready to get their second instalment of the VI Pay Commission Arrears and this is going to be 150% of the arrears they got last year. Now you don't have access to all the money – there's the taxman who wants his share.
Yesterday the CBDT issued a Circular advising the DDOs and PAOs to compute the correct tax liability of every employee on second instalment of arrears drawn by him and immediately recover the full tax liability along with education cess thereon at the rates in force. The deduction of tax at source on such arrear payment should not be deferred in any circumstance. They should further ensure that the tax so recovered is paid to the account of Central Government account immediately as per the Income Tax Rules, 1962. The DDOs / PAOs are further advised that they should ensure that the PAN details of the deductees (recipient of arrears) are correctly quoted in the relevant quarterly e-TDS returns filed by them so that the Government Servants get proper credit of their tax deducted in their respective income tax returns.
DDOs / PAOs who fail to comply with the provisions of Section 192 of the Income-tax Act, 1961 would be liable to pay interest under section 201(1) /( 1A ) of Income Tax Act along with other penal consequences.
CBDT Circular No. 6/2009: Dated 31st August, 2009