The CBDT i.e Central Board of Direct Taxes on 23rd April, 2024, with a view to redressing the grievances faced by deductors/collectors who have collected TDS/TCS at normal rate but was required to deduct /collect at double the rate on account of PAN of the deductee being inoperative due to non-linkage of such PAN with Aadhar from 1st April ,2023 has issued  a circular no 6 on 23rd April ,2024 not to treat such  TDS deductors in default ( short deduction for the purpose of TDS) for the tax deducted at normal rate for transactions entered into up to 31.03.2024, if in such cases the PAN of deductee is linked to Aadhar and hence becomes operative on or before 31.05.2024. In such cases, there will be no liability on the deductor or the collector to deduct or collect the tax under section 206AA/206CC at double rate just because of PAN being inoperative due to non-linkage of PAN with Aadhar and hence such deductors will not be required to pay the difference.

It’s a Big relief from the taxpayers or Tax collectors point of view, but the above is applicable for transactions till 31-03-2024.

For more information on relaxation from TDS default if PAN and Aadhar linked & Circular No. 6 of 2024 on TDS TCS, kindly visit us at Anam Shaikh & Associates – leading CA firm in Mumbai.

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