Tds return for non deducting employers

[DINESH MITTAL]

whether TDS return for the 'A' who are not deducting the tax on payments to transporters, who provide PAN, is mandatory or not. Also, whether NIL TDS return are required to be filled or not.

[Surender Gupta]

The filing of a NIL statement is not mandatory.

[Surender Gupta]

My, above views are based on earlier provisions and NSDL website. But if you read the bare provisions carefully, there is a conflict in the provisions of Act and Rules. Sub Section (3) of Section 200 of the Income Tax Act, 1961, makes it mandatory to file return where TDS has been deducted. Whereas rule 31A of the Income Tax Rules, 1962 (see updated rules under Income Tax Section on this portal) after amendment makes it mandatory for each person having TDS / TCS number allotted. If you ask for strict statutory interpretation, the provisions of Rules can not override the provisions of Act. Therefore, you are not liable to NIL return. On the contrary, practically, department may put you in trouble under provisions of Rule 31 therefore, practically it is advisable that you should submit NIL return.

AI Summary

TDS filing obligation: nil returns not required under the Act but rules may practically compel employers to file. The Act requires TDS return filing only where tax is deducted, while rules mandate filing for every person with a TDS/TCS number. Strict interpretation indicates a nil return is not mandatory, but practical enforcement risks under the rules make submission of a nil return advisable for employers who do not deduct tax on payments to transporters that furnish PAN.