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The currency markets have been adjusting the valuation of the US dollar over the past six years. Its trade-weighted index now, at 80, appears fairly adjusted against all the major currencies compared to its peak of 120 in mid-2002. Viewed against this performance of the US dollar against major currencies, at around its current price of Rs48, the Indian rupee has gained about 3% from its level...
Front-running has been widespread in the Indian (and overseas markets) but regulatory authorities in India have rarely been able to nail it conclusively. This is exactly what the Securities and Exchange Board of India (SEBI) seems to have done. Front-running is buying and selling securities with insider knowledge, ahead of large orders placed by institutional investors. In a precedent-setting...
a) Pay the TDS only electronically
b) Use a new challan form (No. 17) for paying the TDS
c) Fill in name, PAN and amount of TDS for each deductee while
paying the TDS
d) Generate a Unique Transaction Number (UTN) for each TDS entry
e) Quote the UTN in the TDS certificate (Form 16/Form 16A) issued
f) Quote the UTN in the TDS returns (for which new form no. 24C was
notified)
At the same time, the deductee, while filing his own return of income, was expected to quote the UTN for every item of TDS if he wanted to get credit for the TDS. This provision was made effective retrospectively i.e. w..e.f. Assessment Year 2008-09 (financial year ended 31st March, 2008 and all subsequent years).
All in all, the new rules would have certainly led to lot of problems for tax deductors as well as for deductees. Also, many tax payers were unable to file their returns of income for the year ended 31st March, 2009 even though the same were ready for filing simply because of the confusion about the generation of the UTNs.
Fortunately, now, the Government has acknowledged the plight of the tax deductors and the deductees and has, by issuing a Press Release on 30th June, decided to keep in abeyance the applicability of the new Rules which were notified on 25th March, 2009.
Therefore, now, till further notice,
a) All tax deductors can continue to deposit the TDS in the existing challan no. ITNS 281
b) All corporate tax deductors will continue to pay the TDS electronically. Similarly, Individuals and Partnership Firms will also pay the TDS electronically if they are subject to tax audit
c) All other tax deductors can continue to pay the TDS in physical mode as they have been doing uptill now.
d) The quarterly TDS statements that are required to be filed will continue to be so filed as per existing rules and no new forms are to be filed
e) The returns of income for A.Y. 2009-10 (i.e. for the year ended 31st March, 2009) can be filed without quoting the UTN (even though the form requires the assessee to fill up the same)
We hope that with this, all the confusion that has prevailed in the context of payment of TDS to the Govt. and generation of the UTNs stands cleared. If you have any doubts about the matter, please feel free to contact the undersigned.
Ameet Patel
Partner
SKP - Mumbai, India
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