• Excess charging of TDS

Case history
                       fd a/c(cumulative interest mode)
original invested amount rs 100000.maturity amount rs 152279 
starting date   25/05/2009 maturity date 25/05 2014
  matured amount became rs 146287 on 25/05/2014 tds of rs 5992 was effected
               as per bank record interest accrued and corresponding tds  effected as per section 194a of it act
actually interst accrued is not paid to customer yearly,but customer must show interest accrued and corresponding tds while filing it returns
financial year                        interest accrued                       tds(10%norms)
2009-10                                      rs 7401.52                             rs 741 
2010-11                                      rs 9369                                   rs 937 
2011-12                                     rs 10130                                 rs 1013 
2012-13                                     rs 10894                                  rs 1090 
2013-14                                     rs 11774                                   rs 1175 
total interest up to 31/03/2014=rs 49569 (a)               total tds up to 31/03/2014=rs 4956(b)
year 2013-14 means up to 31/03/2014.however fd a/c  matured on 25/05/14 .original invested amount was rs 100000.maturity amount was rs 152279.total interest of rs 52279(c) was paid for the entire period
therefore from 01/04/2014 up to 25/05/2014(date of maturity) interest paid=(c) minus (a)=rs 52279-rs49569=rs 2710,corresponding tds=rs 271(d)
therefore total interest paid =(a)+(c)=rs 49569+rs 2710=rs 52279,10% of rs 52279=rs 5228
therefore total tds =(b)+(d)=rs 4956+rs 271=rs 5227
but matured amount became rs 146287 on 25/05/2014 tds rs 152279-rs 146287= rs 5992 was effected instead of correct value  rs 5228.so excess tds charged =rs 5992-rs 5228=rs 764

actually i might have an misconception that while bank has effected tds on yearly basis and again deducted rs 5992 on maturity ,it is a case of charging double tds .
but definitely it a case of excess tds charging buy an amount of rs 764 as described above
please opine .with thanks
Asked 3 years ago in Income Tax from Kolkata, West Bengal
You can ask to your bank to give you TDS certificate, which will clarify your situation.
You can also refer to your 26AS available on Income Tax site.
Shiv Kumar Agarwal
CA, Delhi
273 Answers
61 Consultations

5.0 on 5.0

I have carefully gone through your query. It can be summarized as follows.
Bank should have paid you Rs. 147051 (Rs. 152279- TDS Rs.5228). However, they paid you 146287 i.e. Rs. 764 less. Let us understand why this happens.
The bank pays TDS on your behalf every year. This amount gets reduced from the amount of FD since this reduces the balance with them. Naturally it reduces the amount of interest payable to you on that much amount. However, for calculation purpose, they will deduct the TDS on the total interest payable to you. 
Is it not that you have been able to claim the benefit of TDS in the respective years, even without actually  spending money in those years. 
I think bank is corret.
Sagar Jayawant
CA, Thane
27 Answers
7 Consultations

5.0 on 5.0

Sir this question is already answered.

if you have query after the answer then you can send. 

The Bank as far as my knowledge has a TDS deduction software and you check with the Banker. There is something missing.
Shyam Sunder Modani
CA, Hyderabad
1408 Answers
102 Consultations

5.0 on 5.0

Even if excess tds charge you can claim that back by filing return of income so need to go for such details
Vishrut Rajesh Shah
CA, Ahmedabad
631 Answers
13 Consultations

5.0 on 5.0

I already answered this query. My reply to the same query raised earlier is reproduced here for your ready reference:

In your case, there is excess deduction of tax at source by deducting tax again at the time of repayment without giving credit for tax already deducted and remitted. The total TDS cannot exceed 10.3%.

The interest is accounted for on accrual basis by the bank and TDS is thus on accrual basis. However, as an individual, not subject to tax audit, you can account for interest either on accrual or cash basis. 

You can offer income on accrual basis as per 26AS and claim credit for TDS in the same year of deduction. In this process, there will not be mismatch between 26AS and your return. 

You also have an option to carry forward the claim for TDS as per 26AS to the next year and claim TDS only in the year in which you are offering interest to tax.
B Vijaya Kumar
CA, Hyderabad
859 Answers
56 Consultations

5.0 on 5.0

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