Further as per section 197 of Income tax act ,Assessing Officer can issue a Nil rate certificate to parties under specified section on application on form 13 with prescribed details and if such parties produce "Nil " rate certificate to deductor , deductor is not required to deduct tds . so In both the cases tax deduction is Nil.
Third type of Nil transaction is "where amount paid is less than cut off amount given in respective section"
In all three case above , Tin-Nsdl has provided tags in etds return .
- To incorporate Nil rate transporter entries in etds return by inserting a tag "T" in remarks in 26q
- To incorporate Nil rate entries due to section 197 Tag "B" is to be shown in remarks column in 26q
- Now Tin-NSDL has also provided a tag "Y" to incorporate entries of nil deduction where amount is less than cut-off amount.
Now the question is ,whether one should file return as suggested by tin -nsdl or there is legal Binding on us to report such entries.The answer is given below
As per Income tax act section 200 quarterly return is required to be filed where TDS has been deducted .Means if tds has not been deducted then no need to file the return .
But now Income Tax Rules 31AA has been amended to incorporate first two type of entries in quarterly returns from 01.04.2011.
As per new rules amended vide notification 16/2011 dated 29/03/2011
- Nil tds on payment to transporter
- Nil tds due to nil certificates issued by AO u/s 197 to party