TDS Mismatch - No Coercive Action- CBDT
BY letter dated 01.06.2015, the CBDT had issued directions to the field officers that in case of an assessee whose tax has been deducted at source but not deposited to the Government's account by the deductor, the deductee assessee shall not be called upon to pay the demand to the extent tax has been deducted from his income. It was further specified that section 205 of the Income-tax Act, 1961 puts a bar on direct demand against the assessee in such cases and the demand on account of tax credit mismatch in such situations cannot be enforced coercively.
However, instances have come to the notice of the Board that these directions are not being strictly followed by the field officers.
The Board reiterates the instructions in its letter dated 01.06.2015 and directs the assessing officers not to enforce demands created on account of mismatch of credit due to non-payment of TDS amount to the credit of the Government by the deductor.
CBDT Office Memorandum in F.NO. 275/29/2014-IT (B)., Dated: March 11 2016