less than 70 % pan how to file etds return(new fuv 2.110)

Facts :A bank manager has deducted tax on interest paid on deposits in bank by farmer and had deposited the amount deducted ,but the now the problem is that no farmer has PAN ,and evan they have not applied for it & not willing to apply for pan also,as they have no other income than agriculture income & interest on deposit from bank.But as per new fuv 2.110 minimum 70 % pan is necessary to file the return.so how he can file etds return.

point wise answer to your queries are

point:1:If customer does not have a pan then whether it is mandatory to deduct tax or not on interest.

Answer: Yes ,it is mandatory to deduct tax ,no matter the deductee has a pan or not.Means liability to deduct tax does not change on the basis whether deductee has a pan or not.
However ,Bank Manager can take form 15G and 15 H as the case may be from the farmers.

Point:2:If the deductor has less than 70% of Pan ,how he can file etds return.

Ans:The Govt. has issued this circular to fill at least 70%/90% pan because person generally have a tendency not to fill Pan in etds return ,evan if they can manage to collect the same from deductee.If pan is not filled in the etds return than whole purpose of etds return and e management of tax will be defeated .But due to this circular genuine cases are also faces problem like of yours.

So to file the return in present circumstances ,first of all ,try to obtain maximum pan you can do,pursue persons (deductee) to apply new pan if possible,it will take only 15 days to get new pan ,and it can be checked online with in 8-10 days online from date of application.Tell them if they will not obtain the pan ,they will not able to file their return & in result can not claim refufd for which they are otherwise eligible.

Moreover communicate to deductee in writing to submit their pan & please don't forget to mention their (deductee)responsibility to submit Pan to deductor under Income Tax Act & Penalty applicable If he does not do so.

I am giving you one other solution for filing the etds return without the pan,but the solution is not 100% accurate /valid solution.By this solution you will able to file the return but it has there own drawback and consequences .So take your own decision ,file return by applying following solution or do not fill the return at all.


solution is very simple ,

1. .Fill the available Pan against the deductee.
2. Fill Pan not available"PANNOTAVBL" against up to 30% OF entries.
   
3. Fill false pan against rest of the entries.False pan means a pan which is structurally(know pan structure) valid but not in pan data base of income tax like put aaapa5555a against rest of the deductee .Please ensure that false pan is not in ITD database Otherwise credit will be given to pan holder
4. Revise your return within assessment year or after receipt of all(minimum) missing pan.
   

fuv 2.110 checks only structure of the pan ,and does not match pan with pan data base of the income tax so by this trick the return can be passed through fuv and a valid return file can be generated.

This solution should be applied only after taking your client in confidence and as a last alternative and only after 200% try to collect valid pan from the deductee.

In my opinion in genuine cases income tax deptt will not take serious view . The reason behind this the deductor can not go door to door if deductee has not provide pan to the deductor.It is a responsibility of deductee to provide pan to deductor and deductor's responsibility is to fill pan while filing etds return,so deductor should not be sufferer due to irresponsible act of the deductee.

note:one more think i would like to add deductee record on which nil tax has been deducted and shown as reson for non deduction (column 428)"b" will not be counted while calculating the 70% of deductee record.

please comment if have a different idea or if you like something to add.

Update :11.08.08
How to fill etds return with insufficient pan (official word)


related issues:

NEW FILE VALIDATION UTILITY(FVU 2.116)DIRECT LINK DOWNLOAD NOW
what is new in 2.116 FVU(applicable from01.04.2008)

NEW FILE VALIDATION UTILITY(FVU 2.110)DIRECT LINK DOWNLOAD NOW

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