14 November 2009

Brand Name for Packing Industry: - All is well that ends well

Prepared by: - CA. Pradeep Jain

Sukhvinder Kaur, LLB(FYIC)

 

visit us : www.capradeepjain.com

 

Introduction: -

 

SSI exemption has been granted to boost the small scale industries. Exemption is granted from payment of basic excise duty and from special duty of excise on clearances of specified value of goods. The specified value as well as the limit of exemption is fixed vide Notifications which are issued from time to time. SSI exemption was granted initially vide Notification No. 175/1986-CE, dated 01.03.1986. At present the Notification in force granting SSI exemption is Notification No. 8/2003-CE, dated 01.03.03 and as amended.

 

The dispute involved: -

 

SSI Exemption is granted subject to fulfillment of certain conditions which are prescribed in Notification no. 8/2003. One of the conditions prescribed is that the SSI exemption will not be applicable to specified goods bearing a brand name or trade name of another person, irrespective of the fact whether such brand name was registered or not contained in Para 4 of the Notification. However, exceptions are also provided to this condition such as goods cleared as `original equipment', goods bearing brand name or trade name of KVIC or if such goods were manufactured in factory located in rural area. The exceptions in the Notification read as follows:-

 

"4. The exemption contained in this notification shall not apply to specified goods bearing a brand name or trade name, whether registered or not, of another person, except in the following cases: -

(a) ………

(b) ………

(c)…………

 

The definition of `brand name or trade name' is given in Explanation to Para 5 which reads as follows:

 

Explanation.- For the purposes of this notification,-

 

(A) "brand name" or "trade name" means a brand name or a trade name, whether registered or not, that is to say, a name or a mark, such as symbol, monogram, label, signature or invented word or writing which is used in relation to such specified goods for the purpose of indicating, or so as to indicate a connection in the course of trade between such specified goods and some person using such name or mark with or without any indication of the identity of that person;

 

Thus, the Notification is denying SSI exemption to units which are manufacturing goods which have a brand name/trade name of another person. This has lead to a lot of litigation.

 

The Apex Court in the case of M/s Kohinoor Elastic Pvt. Ltd. [2005 (188) ELT 3 (SC)] held that the benefit of SSI Exemption is not available to the goods bearing a brand name/ trade name of the customer, manufactured by a SSI unit, as per the orders of the customer, for further use by the customer in the manufacture of his final product. The said unit was manufacturing elastic tape and affixing the brand name of his customer who was manufacturer of undergarments. This was done as per specific instructions of the customer.

 

Issue of the SSI manufacturers: -

 

The SSI manufacturers who are engaged in manufacture of flexible packing material like plastic bags, corrugated boxes etc, were printing/affixing the brand name of the customers whose goods are to be packed therein, were being denied the benefit of SSI exemption. The said manufacturers contended that this was not a use of brand name of another person by them.

 

It was contended that the packaging material will definitely contain the brand name of some other party as it is to be used by that other party for packing their final product. However, the SSI exemption cannot be denied merely on these grounds as this sale is not in course of normal trade and the goods are to be specifically used by the buyer booking the order. The Board has, also, interpreted the like cases in favour of the assessees.

 

Amendment of Notification No. 08/2003-CE: -

 

Several representations were made by the Trade and Industry against the stand of the Department that printing on packing material will amount to use of brand name of other person. Although it does not sound logical but the language of notification was such that it lead to such a confusing situation.  

 

The Board, ultimately, amended the Main Notification No. 8/2003-CE by Notification No. 47/2008-CE dated 1.09.08. With this amendment, exemption was granted to specified goods which were in the nature of packing materials. The relevant clause (e) of Para 4 is reproduced here under:

 

"(e) Where the specified goods are in the nature of packing materials, namely, printed cartons of paper or paper board, metal containers, HDPE woven sacks, adhesive tapes, stickers, PP caps, crown corks, metal labels."

 

Further, the exemption granted to specified goods in the nature of packing materials was limited to clearances upto Rs 90 lakhs for the remaining part of financial year 2008-09. The relevant clause is reproduced as under:-

 

"4B Notwithstanding anything contained in the preceding paragraphs, the exemption in respect of goods specified in clause (e) of paragraph 4, contained in this notification, shall be restricted to rupees ninety lakhs for the remaining part of the financial year 2008-09."

 

The said amendment is effective from 1st of September, 2008. But this has also lead to certain problems. One of the problem was that the exemption granted only to printed cartons of paper or paper board, metal containers, HDPE woven sacks, adhesive tapes, stickers, PP caps, crown corks, metal labels. But this notification has not included the packaging material (i.e. material for primary packing) like the products of polymers units - pouches and plastic bags. The use of the word `namely' had also restricted the scope of packing materials which were eligible for SSI exemption under Notification No. 8/2003- CE.

 

Again the representation was made to the Ministry of Finance. The Board has once again considered the representation of the industry and amended the basic SSI Notification 8/2003-CE (cited supra) by the Notification No. 2/2009- C.E. dated 11.02.2009 and plastic bags were added in the above list. But still some packing materials were not added to the list and the printed laminated rolls were added in the budget by Notification No. 9/2009-C.E. dated 07.07.2009.  Thus, the Board has considered the submission of Trade and Industry and amended the notification on their representation.

 

The after situation: -

 

As already stated, the amendment only brought relief to certain extent but also raised certain other problems. One such problem was handled by Board by amendment in the notification. But the other problem was raised by the department. They said that the exemption granted to specified goods in the nature of packing materials had been granted from 1st of September, 2008. This meant that the SSI exemption has been granted from 1st of September, 2008 and not from 1.03.2003 when Notification No. 8/2003- CE was made effective. Consequently, the SSI units manufacturing packing materials of the nature mentioned above have been made liable to pay duty from 1.03.2003 till 1.09.08.

 

Thus, the Demand for duty could be raised from such SSI units which had not paid duty by claiming the SSI exemption under Notification No. 08/2003-CE. This could have led to a lot of issuance of show cause notices all over the country. This is due to the fact that the entire SSI industry manufacturing packing materials was not paying the duty and was claiming exemption.

 

Section 11C Notification: -

 

This has led to a number of representations from the packing material industries all over India once again. The Board has power to issue retrospective exemption under Section 11C of Central Excise Act if there is duty on certain product and general practice of industry is such that they are not paying duty during that period.

 

Now, the Board has once again considered the representation of the industry and issued Notification No. 24/2009-CE (NT) on 21.10.09 granting Section 11C exemption to SSI units manufacturing packing materials, namely printed cartons of paper or paper board, metal containers, high density polyethylene woven sacks, adhesive tapes, stickers, pilfer proof caps, crown corks, metal labels; Plastic Bags and Printed laminated rolls. The exemption from payment of duty has been granted on the said goods manufactured by a unit where the manufacturer had affixed the specified goods with a brand name or a trade name of another person who is not eligible for grant of exemption under the relevant Notification. The exemption is granted with retrospective effect. Thus, the issue has been settled and SSI manufacturers of packing material have got the relief from the Board.

 

Before parting: -

 

Thus, the SSI units who were affixing brand name or trade name of another on the packing material, Plastic Bags and Printed laminated rolls have been finally granted relief  which was not only long awaited but was well fought by the SSI manufacturers. Also, the Board has also played a very positive role in granting the exemption to end this issue. The complete period of this issue has been very cumbersome but it is famous proverb- "All is well that ends well."

 

13 November 2009

Payment System in India - Vision Document by RBI

Draft on "Payment Systems in India - Vision 2009-12"

The Reserve Bank of India has today placed on the website the draft of "Payment Systems in India - Vision 2009-12" for public comments. The Bank has also placed the document on "Vision 2005-08 - Accomplishments Vs statements" for information. Comments may be addressed either by post to the Chief General Manager, Reserve Bank of India, Department of Payment and Settlement Systems, Central Office, Fort, Mumbai - 400 001 or sent by Fax at no. 022-2265 9566 or sent by e-mail on or before November 30, 2009.

G. Raghuraj
Deputy General Manager

Press Release : 2009-2010/703



--
CA. V.M.V.SUBBA RAO
Chartered Accountant
Door No.24-2-1885,
I Floor, Flat No.5,
Siddivinayaka Residency, I Cross,
Central Avenue, MSR Nagar,
Magunta Layout,
Nellore-524 003
Andhra Pradesh
India
Mobile:+91 - 0 9390221100
           +91 - 0 9440278412
e-Mail: vmvsr@rediffmail.com
           vmvsr@yahoo.co.uk
http://pdicai.org/MyPage/203038.aspx

Highlights of White Paper on GST

Highlights of GST Draft Guidelines are as under:

 

  1. Central and state GST will apply on all transaction of goods and services   

 

  1. Tax paid as central GST will be allowed  to taken as input tax credit  

 

  1. State GST will also be allowed to be taken as input tax credit  

 

  1. Cross-utilisation of input tax credit not allowed

 

  1. GST administration to be separate for State and Centre   

 

  1. GST payer to be allotted a unique ID number linked to PAN number

 

  1. Tobacco products also subjected to GST   

 

  1. Alcoholic beverages to be kept out of GST and to be taxed at sales tax/VAT rate instead of GST Sales tax to be applied on petroleum products  

 

  1. No decision on excluding natural gas from GST   

 

  1. "Necessary items" to attract lower GST rate  

 

  1. Services to be taxed at a single rate for both centre and state  

 

  1. Small traders to be kept out of GST net  

 

  1. Businesses with annual turnover below Rs 10 lakh to be exempt from  State GST  

 

  1. Businesses below annual turnover of Rs 1.5 crore  to be exempt from central GST  

 

  1. GST to have composition/compounding  scheme  to avoid instances of double  taxation- Proposes compounding cut-off at Rs 50 lakh of gross annual turnover and floor rate of 0.5% across the states  

 

  1. Central and state GST to be  applied on goods and services imported  

 

  1. GST on imported goods and services to follow destination principle  

 

  1. Inter-state transactions  to  attract Centre and State GST- GST on inter-state transactions can be set off against future transactions

 

 

 

 



--
CA. V.M.V.SUBBA RAO
Chartered Accountant
Door No.24-2-1885,
I Floor, Flat No.5,
Siddivinayaka Residency, I Cross,
Central Avenue, MSR Nagar,
Magunta Layout,
Nellore-524 003
Andhra Pradesh
India
Mobile:+91 - 0 9390221100
           +91 - 0 9440278412
e-Mail: vmvsr@rediffmail.com
           vmvsr@yahoo.co.uk
http://pdicai.org/MyPage/203038.aspx

11 November 2009

Empanelment with the office of ROC for technical scrutiny of Balance Sheets.

 
Dear Members,
 
We are glad to inform that the Registrar of Companies across the country are preparing a panel of professionals for technical scrutiny of balance sheets filled by the Companies for the respective states. The announcement regarding the same is hosted at Institute's web site under the link <Announcement> with the caption "Panel for outsourcing of work of technical scrutiny of balance sheets".
 
Members may note that panel containing details of the following has already been submitted to the concerned offices of Registrar of Companies:
 
A. Chartered accountants/firms which have already applied for the Multi-purpose panel for the year 2009-10.
 
B. Those chartered accountants/firms who had not applied MEF and had sent their details either by post or mail till 4th November, 2009.
 
Further, it may be noted that technical scrutiny of balance sheet does not involve attestation function, accordingly even a Chartered Accountant not holding certificate of practice is eligible to apply for the subject panel.
 
Those Chartered accountants who wish to get themselves empanelled, may please e-mail following details at pdc@icai.in with the subject "Empanelment with the office of RoC"
 
A.  Name of the Member
B.  Membership No.
C.  Professional Address
D.  Year of COP
E.  Mobile No.
F.  E-mail id
 
With kind regards
Professional Development Directorate
The Institute of Chartered Accountants of India,
'ICAI BHAWAN',
Post Box Number 7100,
Indraprastha Marg,
NEW DELHI - 110 002.
India
Telephone - Direct +91 11 30110444
Telephone - Board +91 11 39893989 Extn: 444
Fax: +91 (11) - 30110583
Website: www.icai.org

10 November 2009

First Discussion Paper on GST

Tuesday, November 10, 2009
  Ministry of Finance  
 
FM'S SPEECH AT MEETING OF EMPOWERED COMMITTEE OF STATE FINANCE MINISTERS ON GST

 
  16:37 IST  
 
  Following is the text of speech delivered by Finance Minister Shri Pranab Mukherjee at the meeting of the Empowered Committee of State Finance Minister here today:

"Dr. Asim Dasgupta, Chairman, Empowered Committee, Shri Sushil Modi, Deputy Chief Minister of Bihar, State Finance Ministers and friends!

It gives me great pleasure to be here on this occasion when the Empowered Committee under the dynamic leadership of Dr. Asim Dasgupta is releasing its First Discussion Paper on the proposed Goods and Services Tax (GST). At the outset, let me whole-heartedly congratulate all of you for giving shape and form to an idea whose time, I believe, has truly come.

We have indeed travelled a long way from the time the announcement was first made in 2006 by the then UPA Government to launch a comprehensive GST in the country by the 1st of April, 2010. At that stage, many of you were preoccupied with the challenge of switching over to the Value Added Tax (VAT) while others were settling down with that tax. The introduction of GST then would have looked like a distant event. But now all of you are richer by the first-hand experience of the benefits that the shift to VAT has brought both to your Governments and the business community leading to improvement in the economies of your States. That may be the reason why I have felt a sense of excitement and enthusiasm in the pace and spirit with which the Empowered Committee has worked over the last couple of months to carve out the design and structure of GST. I commend all of you and your teams for working tirelessly to put together the First Discussion Paper which reflects your collective wisdom on the subject.

At this stage, it is important to recall the benefits that this long-awaited reform in our indirect taxation promises to all of us. Our current structure of indirect taxes is driven by a multiplicity of taxes- some levied by the Centre and others by the States. Each of these taxes applies to a narrow base both in terms of the economic activity it covers e.g. manufacture, sale, entry, entertainment etc. and the range of goods and services it applies to. While the base for many of these taxes overlaps, each is an island in terms of flow of input credit. The output tax is allowed to be adjusted against tax already paid on inputs only in a few cases. Then, there is a variety of exemptions meant to serve multiple socio-economic objectives. As a consequence, high rates of tax are required to be imposed to generate a given amount of revenue.

As tax collectors, we may draw comfort from the fact that we manage to generate the targeted revenues. But there are questions that beg an urgent response. First, are collections made in the most efficient manner and do they match the potential? Second, what is the hidden burden of taxes in the form of cascading and double taxation? Third, why is our tax structure so complex and prone to disputes and litigation? These questions cannot be side-stepped any longer as they have implications for the robustness and growth of the very base that yields our tax revenues.

The merits of GST are well-known. It will re-distribute the burden of taxation equitably between manufacturing and services bringing about a qualitative change in the tax system. With the minimisation of exemptions, it will broaden the tax base and lower the tax rates. By switching to the destination principle, the distortions will be reduced fostering a common market across the country. The compliance cost will come down and our trade and industry will become more competitive leading to an increase in exports and lower prices for domestic consumers.

The proposed Goods and Services Tax (GST) can deliver on all these promises only if it has the following essential features:

(i) It is comprehensive in scope and applies to as large a range of goods and services as possible by minimizing the number of exemptions to a small list of essential items which impact the common man. To the extent possible, the exemption lists of the States and the Central Government are in alignment;
(ii) The rates of tax of CGST and SGST taken together are moderate;
(iii) The rates of tax of SGST and exemptions from SGST are uniform throughout the country so that a given set of goods and services invites the same tax treatment in every State;
(iv) The input credit chain is seamless covering the entire value chain from manufacturing to retail without breaks regardless of whether goods or services are supplied within a State or across State boundaries;
(v) As far as possible, every transaction in the tax net bears both CGST and SGST;
(vi) The tax treatment of goods and services is similar;
(vii) The Central and State levies are fully neutralized in the case of exports (out of India); and
(viii) The procedures are simple and harmonized between the Centre and the States.
I am confident that the model proposed in the First Discussion Paper prepared by the Empowered Committee has taken all these concerns on board. Detailed discussions with all stake-holders which will begin with the release of the documents today will help us to refine the design and concepts further.

I notice that significant progress has been made in developing a consensus on various issues. Now we must ensure that settled issues are not re-opened and we move forward at a fast pace. Once we decide on the rate structure and agree on the list of exemptions there should be no deviation in the pursuit of short-term interests. All of us will have to keep the long-term interests of the economy in view by taking carefully thought-out decisions in consultation with each other before making any deviations. This spirit of co-operative federalism is the essence of GST and the only feature that would ensure that a national market with free movement of goods and services across State boundaries develops, in the true sense. There is a view that insistence on strict adherence to mutually-agreed rates would impact the fiscal autonomy of States. To begin with, the canvas of fiscal policy is much wider than taxation and goals of public policy are as effectively met through the expenditure side of the budget. Even within the realm of taxation, the belief that the only degree of freedom available to us for enhancing revenues is by changing the rates of tax is a somewhat limited view. There is enormous scope for augmenting revenue collections by improving our tax collection machinery and the delivery of taxpayer services. There is ample evidence to show that lower taxes lead to better compliance and higher revenues. GST gives us an opportunity to bring together the machinery of the Centre and the States to jointly work for better enforcement.

To improve the quality of our taxpayer services, we have to focus more closely on the benefits of working collaboratively with the taxpayer community to improve our outreach and assist them in the due discharge of their tax liability. This is an area where the policy options are many and the freedom to make a difference immense.

Amongst the administrative actions that are critical for the success of GST is the creation of a strong Information Technology Infrastructure both for the Centre and the States. Many of the issues I have mentioned earlier are easily amenable to IT-based solutions. Besides, such an infrastructure is required for reducing the physical interface between the taxpayer and the department so that compliance costs are curtailed. Some other measures for improving internal efficiency within tax departments include quick & timely exchange of data between the Centre and the States for risk-profiling, audit etc.

With these words, I once again commend all of you for the hard work you have put in and hope that the Discussion Paper generates a robust and informed public debate across the length and breadth of the country so that the ownership of GST is a given as and when it is introduced. On our part, I assure you that the recommendations and suggestions made in the Discussion Paper would receive our in-depth and meticulous attention so that we are able to jointly finalize the structure and design of GST at the earliest."

BSC/BY/DN-371/09
 
 


--
CA. V.M.V.SUBBA RAO
Chartered Accountant
Door No.24-2-1885,
I Floor, Flat No.5,
Siddivinayaka Residency, I Cross,
Central Avenue, MSR Nagar,
Magunta Layout,
Nellore-524 003
Andhra Pradesh
India
Mobile:+91 - 0 9390221100
           +91 - 0 9440278412
e-Mail: vmvsr@rediffmail.com
           vmvsr@yahoo.co.uk
http://pdicai.org/MyPage/203038.aspx

07 November 2009

Provisioning Requirement for Standard Assets- New Notification


--
Date: Nov 05, 2009
Provisioning Requirement for Standard Assets

RBI 2009-10/209
DBOD.No.BP.BC. 58 /21.04.048/2009-10

November 5, 2009

The Chairman and Managing Director / Chief Executive Officer
All Commercial Banks (Excluding RRBs and LABs)

Dear Sir,

Second Quarter Review of Monetary Policy for the Year 2009-10 –
Provisioning Requirement for Standard Assets

Please refer to paragraph 158 of the Second Quarter Review of Monetary Policy for the year 2009-10 announced on October 27, 2009 (copy of the paragraph enclosed).

2.  In terms of paragraph 2 (a) of our circular No. DBOD.BP.BC. 83/21.01.002/ 2008-09 dated November 15, 2008, the provisioning requirements for all types of standard assets had been reduced to a uniform level of 0.40 per cent except in the case of direct advances to Agriculture and SME sectors which continued to attract a provisioning of 0.25 per cent.

3. In view of large increase in credit to the Commercial Real Estate  (CRE) sector over the last one year and the extent of restructured advances in this sector, it would be prudent to build cushion against likely non-performing assets (NPAs). Accordingly, it has now been decided to increase the provisioning requirement for advances to the CRE sector classified as 'standard assets' from the present level of 0.40 per cent to 1.00 per cent.

4. The standard asset provisioning requirements for all categories, after the above change, are summarised below.

Sr. No.

Category of standard asset

Rate of provisioning

(a)

Direct advances to Agriculture and SME sectors

0.25 %

(b)

Commercial Real Estate  (CRE) sector

1.00 %

(c)

All other loans and advances not included in (a)  and (b) above

0.40%

Yours faithfully

(B. Mahapatra)
Chief General Manager


Paragraph 158 of the Second Quarter Review
of Monetary Policy for the year 2009-10

In view of large increase in credit to the commercial real estate sector over the last one year and the extent of restructured advances in this sector, it would be prudent to build cushion against likely non-performing assets (NPAs). Accordingly, it is proposed to increase the provisioning requirement for advances to the commercial real estate sector classified as 'standard assets' from the present level of 0.40 per cent to 1 per cent.


CA. V.M.V.SUBBA RAO
Chartered Accountant
Door No.24-2-1885,
I Floor, Flat No.5,
Siddivinayaka Residency, I Cross,
Central Avenue, MSR Nagar,
Magunta Layout,
Nellore-524 003
Andhra Pradesh
India
Mobile:+91 - 0 9390221100
           +91 - 0 9440278412
e-Mail: vmvsr@rediffmail.com
           vmvsr@yahoo.co.uk
http://pdicai.org/MyPage/203038.aspx

FAQs for ICAI Members to become Members of ICAEW under the Memorandum of Understanding (MoU)

FAQs for ICAI Members to become Members of ICAEW under the Memorandum of Understanding (MoU) signed between the Institute of Chartered Accountants of India & the Institute of Chartered Accountants in England and Wales.

1. What is the current scope of MoU between ICAI & ICAEW?

The MoU provides for Recognition and Examination arrangements for the members of the two largest Institutes. This agreement would facilitate mobility of members across the borders and further strengthen the ties between India and Great Britain. The MoU entitles Institute membership without license to practice. General practice rights excluding auditing rights would be available.

2. What is the effective date of the MoU?

This MoU would be effective from December 01, 2008

3. What is the process for an ICAI member wishing to take up the membership of ICAEW?

Existing members of ICAI, in good standing and with two years post qualification experience which meets the learning outcomes of the two ICAEW Technical Integration papers (may apply for credit for prior learning) will be eligible for ICAEW membership on passing single examination of ICAEW on Case Study. The ICAI members with less than two years experience and who do not meet the learning outcomes of the two ICAEW Technical Integration papers (not able toapply for credit for prior learning) will be required to appear additional papers in Business Reporting (T1) and Business Change (T2) along with the Case Study. All ICAI members must also complete the ICAEW̢۪s online Structured Training in Ethics Programme.

4. What are the costs associated with becoming an ICAEW member?

Registration with the ICAEW
Registration Fee £ 165.00;

and

Credit for Prior Learning Fees

£ 840.00 if sitting the ICAEW Advanced Stage Technical Integration papers; or

£1,150.00 if applying for credit for ICAEW Advanced Stage TI papers

These fees are non-refundable and are required at the point of initial registration

Purchase of ICAEW learning materials (www.gillards. com/icaew)

Learning materials for TI exams £ 130.00
Postage and packing £ 74.74
Learning materials â€" Case Study £ 65.00
Postage and packing £ 35.71


Examination( s) Registration
Technical Integration Papers £ 155.00 each per sitting
Case Study £ 240.00 per sitting


Tuition
Please refer to your training provider. This will be the ICAI for any tuition in India


Membership Application
Admission Fee £ 250.00;
and
Full Year Subscription £ 172.00;
or
Half Year Subscription £ 86.00
(Half year subscriptions apply to all memberships starting on or after 1 July)


Cost for ICAI member qualifying by sitting the Case Study from: £ 2,077.71


Cost for ICAI member qualifying by sitting the Technical Integration papers and Case Study from: £ 2,282.45

These costs are approximate and are subject to change

5. What is the procedure/steps to be followed to become ICAEW member?

  1. Apply to ICAEW in the prescribed format for registration.
  2. Register with the ICAEW with requisite documents
  3. Purchase learning materials
  4. Register for exam(s) as mentioned in 3 above.
  5. Sit & pass exams
  6. Complete online Structured Training in Ethics Programme (STE)
  7. Complete application for membership and file it along with the letter of Good Standing issued by the ICAI

6. What documents are required at the time of registering with the ICAEW?

Registration would require

   * Personal Details
   * Proof of active ICAI membership
   * Proof of Good standing
   * Confirmation of work experience
   * Registration fee
   * Credit for Prior Learning fees

ICAI members with no adverse disciplinary findings made against them and those who have confirmed their compliance with the CPD requirements of ICAI will only be eligible for the arrangement.

7. What is the experience requirement for the ICAI members?

An ICAI member with a minimum of two years̢۪ post qualification experience which has been certified by their current (and, if appropriate, past) employer(s) which meets the aims and learning outcomes of the ICAEW̢۪s Technical IntegrationBusiness Change and Technical Integration Business Reporting papers. ICAI members who are sole practitioners may self-certify that their post-qualification experience meets the aims and learning outcomes of these papers. These members will also need to complete the ICAEW Structured Training in Ethics programme in order to become eligible for ICAEWmembership.

Those ICAI members with less than two years̢۪ post qualification experience will be required to sit for and pass, Technical Integration Business Reporting, Technical Integration Business Change and the Case Study papers, and to complete the Structured Training in Ethics programme in order to become eligible for ICAEW membership.

There is no additional requirement to undertake any additional training experience or to take any other examinations.

8. How do I apply for credit from the two technical integration papers?

Post qualification experience (work experience)

You must have two years̢۪ post qualification experience, and this must be certified by your current (and if appropriate, past) employer as meeting the learning outcomes of the ICAEW̢۪s Technical IntegrationBusiness Change and Technical Integration Business Reporting papers.

Learning outcomes

To assess this, please review the learning outcomes (PDF 62kb/9 pages). If you are employed, you will need to ask your employer to review these documents before confirming within your letter of employment confirmation that you have covered ALL of these outcomes in your period of employment. If your employer does not clearly state that you have met all of the learning outcomes, your application for credit for the two   technical integration papers could be refused.

Sole practitioners

ICAI members who are sole practitioners may self-certify that their post-qualification experience meets the aims and learning outcomes of these papers. Applicants will not need to return the completed learning outcome grids with their application, however these should be retained as the ICAEW may request copies of an applicants completed grids prior to admission tomembership.

9. What is the sequence in which the requirements as stated at 3 above need to be undertaken by an ICAI member?

(i) Structured Training in Ethics

Following successful registration with the ICAEW, an ICAI member can immediately access the Structured Training in Ethics programme.

An ICAI member may complete the Structured Training in Ethics (STE) Programme at any point between ICAEW registration and application for ICAEWmembership. The programme is independent of the ICAEW examination papers and is a web-based training package which is based on interactive case studies and self-test questions. It is split into three stages that are usually designed to be spread over the length of an ACA students training contract, however for experienced professionals this could be covered intensively in around 5 hours.

The STE programme provides:

   * Structured training in professional ethics
   * case studies and other material on some of the issues you are likely to face
   * Sources of further information and support.

The programme̢۪s objectives are to:

   * familiarise ICAI members with the ICAEW’s code of ethics
   * show the member how to apply the fundamental principles (and ethical guidance) in their work
   * help the member to recognise ethical issues, make ethical decisions and resolve dilemmas
   * help the member know when (and who) to ask for help with ethical matters.

Completion of the STE programme will be mandatory for members of the ICAI wishing to join the ICAEW.  Please visit the ICAEW website for a copy of the Structured Training in Ethics Programme to review. You will need to extract the downloaded files and save them to your hard drive, before the programme will run.

(ii) Technical Integration Papers

The two Technical Integration papers and the Case Study are all written examinations, which would take place under exam conditions. The Case Study must be the last exam attempted by a candidate, however the regulations do allow for all three papers (TI â€" Business Reporting (TI BR), TI â€" Business Change (TI BC), and the Case Study) to be sat in one session.

If a candidate who has not gained the two years̢۪ post qualification experience chooses to sit the papers over more than one session, they must take the two Technical Integration papers first. The Technical Integration papers should be attempted at the same sitting due to their common technical content.

10. How are the requirements, as stipulated in question 3 above, administered?

An ICAI member may complete the Structured Training in Ethics program at any point between ICAEW registration & application for ICAEW membership. The program is independent of the ICAEW examinations and is a web based training package.

Completion of the STE program would be mandatory for members of the ICAI wishing to join the ICAEW.

All examinations will take place at British Council offices and would be administered by the ICAI or a representative of the ICAEW from the British Council.

11. Do I need to take tuition before attempting the ICAEW examinations?

Professional tuition for the ICAEW examinations is not mandatory. However, while not mandatory, it is strongly recommended for all candidates, as it gives individuals the best chance at passing the examinations.

Tuition / training would be available for:

a) TI â€" Business Reporting

b) TI â€" Business Change; and

c) Case Study

Tuition in the UK is provided by ICAEW Training Partners, you would need to arrange this independently. Full lists of tuition centers are available on ICAEW website.

Tuition in India will be imparted by ICAI. ICAI members wishing to undertake professional tuition in respect of the Technical Integration and Case Study papers should contact the ICAI directly. Details shall be available at ICAI̢۪s website shortly.

For ICAI members located in Dubai, ICAEW’s ‘Partner in Learning’ Phoenix Financial Training is running ICAEW classes specifically tailored towards ICAI members. These classes are based in Dubai. For more information, please contact Erica Johnson at Phoenix Financial Training on ericaj@phoenixft. com or on +971 (0)50 295 6331.

ICAI members located in Kuwait interested in classes should contact jonathan.worrell@ icaew.com. Plans are in place to deliver tuition in Kuwait, dependant upon demand. More details will be available shortly.

If you are an ICAI member now located outside of India and not in one of the areas mentioned above should refer to our tuition pages for a full list of UK and international tuition providers.

No training would be required for the completion of the Structured Training in Ethics program.

12. Is there any specified time lag between registration and taking of examinations?

The ICAEW Technical Integration and Case Study papers are only sat in July and November. Please refer to the website for all exam registration deadlines.

13. What would the training encompass?

If you are an ICAI member undertaking tuition in the UK for the ACA Advanced Stage (i.e. the Technical Integration papers plus the Case Study) the syllabus is usually taught over approximately 7 weeks full-time by current professional providers. The Case Study is integrated within these 7 weeks but, if de-coupled, is usually taught over approximately 10 days full-time (including pre-examination revision). This timeframe is based on the time spent   the classroom, candidates are expected to do further work outside the classroom over this period.

If you are an ICAI member wishing to undertake tuition in India the study arrangements may be different. Please contact the ICAI for more information.

14. How many attempts are allowed per paper in order to be eligible for membership of the ICAEW?

A maximum of four attempts are available per paper for all examinations. However, one is advised to sit no more than 3 times in order to remain eligible to apply for credit for prior work experience if you have at a later stage gained the appropriate two years̢۪ post qualification work experience.

15. What is the pass percentage in each paper?

Pass marks are 50% in the Technical Integration and Case study papers.

16. I am a member of the ICAI and am already studying for the ACA, can I take  advantage of the additional credits?

If you are already registered as a student with the ICAEW, you will be eligible for transition onto the new scheme. Please contact the student support team for information on your particular circumstances.

17. I am a member of the ICAI based in India, can I come to the UK for tuition?

If you are based in India and would like to come to the UK to study for the ACA, you would need to obtain a visa. Please visit the UK Border Agency section of the Home Office website http://www.ukba. homeoffice. gov.uk/ to assess you eligibility. You would need to apply for this independently.

18. I would like to take the ICAEW examinations in India, where will I be able to sit these?

Examinations in India will be available at British Council Offices subject to demand. A list of the British Council Offices in India can be found on the British Council website.

Centres available for 2009 include:

? New Delhi

? Mumbai

? Chennai

19. Once I become an ICAEW member can I become an ICAEW student counsellor?

Members joining via the ICAI advanced credit route may become ICAEW counselors within an ICAEW authorized training office upon ICAEW membership.

In order to become an ICAEW qualified person responsible for training ICAI members will need to have held their ICAI membership for two years.

20. Who would be the contact person in India in case of any issues?

Mr V Sagar

Joint Secretary

The Institute of Chartered Accountants of India

ICAI Bhawan

PB No. 7100, Indraprastha Marg

New Delhi â€" 110 002, India.

E-mail: icaewmra@icai. in

Website: www.icai.org

21. Who can I contact at the ICAEW in case of any issues?

ICAEW Membership Enquiries

The Institute of Chartered Accountants in England & Wales

Metropolitan House

321 Avebury Boulevard

Milton Keynes

Buckinghamshire

MK9 2FZ

UK

E-mail: studentsupport@ icaew.com

Website: www.icaew.com/ icai

Tel: +44 (0)1908 248040

Master Circular on OLTAS

Master Circular - Collection of Direct Taxes - OLTAS

 

Circular No. DGBA.GAD.No. H-2/42.01.034/2009-10, dated 1-7-2009

 

Please refer to our master circular RBI/2008-09/81 dated July 01, 2008 on the above subject which was issued with a view to facilitate quick reference to all the extant instructions issued on the subject at one place. We have now updated the master circular incorporating important instructions issued by us till end June, 2009. A copy of the same is enclosed for your information. This circular may also be downloaded from our website www.mastercirculars.rbi.org.in

 

Enclosure

Master Circular on Collection of Direct Taxes

Introduction

The Central Board of Direct Taxes (CBDT) is responsible for administering various direct taxes through the Commissioners of Income-tax located in different parts of the country. The Commissioners of Income-tax are entrusted with the task of collection as well as refund of Income-tax and Corporation Tax, etc. under the Income-tax Act, 1961.

2. The Principal Chief Controller of Accounts (Pr.CCA) is the apex authority of the accounting organisation of the Central Board of Direct Taxes. Under the Departmentalised set up, the Pr.CCA, CBDT has been assigned the functions relating to accounting of all receipts and refunds pertaining to the Direct Taxes. The Pr.CCA sits at New Delhi and operates through Zonal Accounts Offices (ZAOs) across the country. Presently there are 24 ZAOs located at various places.

3. Major Heads of Account

The various types of direct taxes collected by the Income Tax Department are classified under the following Major Heads:

i) Corporation Tax (C.T.)

0020 Corporation Tax

ii) Income Tax (I.T.)

0021 Taxes on Income other than Corporation Tax

iii) Wealth Tax (W.T.)

0032 Taxes on Wealth

iv) Gift Tax (G.T.)

0033 Gift Tax

v) Fringe Benefit Tax

0026

vi) Banking Cash Transaction Tax

0036

 

4. Prior to 1st April 1976, Income and other Direct taxes were accepted by the Offices of Reserve Bank of India (RBI), the branches of State Bank of India (SBI), its associates conducting Government business, treasuries and sub-treasuries. With a view to increasing the number of points at which these taxes could be deposited conveniently by the members of the public, a scheme for collection of income tax and other direct taxes through the branches of public sector banks was introduced with effect from 1st April 1976.

5. 'Accounting System for Direct Taxes' - Revised procedure

(RBI Circular DGBA.GAD.No.H-684/42.01.001/2003-04 dated January 9, 2004)

After studying the issues relating to Accounting and reporting, delays in remittance and in dispatch of documents etc., the 'Working Group on Government Accounts' suggested the revised procedure which came into effect from 1st October 1988. Reserve Bank has issued comprehensive instructions on acceptance of CBDT dues and its accounting and reporting vide its publication 'Accounting System for Direct Taxes' which came to be known as the Pink Booklet.

6. With a view to improving customer service to direct taxpayers, special attention was drawn to the following provisions of 'Accounting System for Direct Taxes' :

(RBI/2004/135 (DGBA.GAD.No.1142 /42.01.001/2003-04) dated April 2, 2004)

(i) Issue of Token : While instructions issued by Reserve Bank regarding the issue of paper token as an acknowledgement of payments are very clear, it is observed that a large number of authorised branches do not issue such tokens. In many places, there are informal arrangements wherein the taxpayer is asked to collect the challan after a specific date from the bank branches. In some cases, the receipted challans are not kept securely and are placed in an open box. The customers are allowed to freely pick up their challans without any identification. In the case of challans deposited with cheque or draft, the receipted challans will be issued on realisation of the amount of cheque or draft and hence the paper token should indicate the date on which the receipted copies of the challans would be kept ready so that the assessee makes an arrangement to collect the receipted challan on the date given in the token.

(ii) Receipted Challan: The receipted challan should be made available to the assessee within 4-5 days, based on the local Clearing arrangements. The branches should ensure that this stipulated waiting period must not be exceeded and any deviation in this regard will be viewed seriously by Reserve Bank. The receipted challans should be handled with care and in a secured manner till they are handed over to the assessee across the counter on presentation of the relevant paper token. Under no circumstance, the receipted challan should be kept in open box accessible to customers.

(iii) Double Date Stamp on Receipted Challan: It is reiterated that the challan should bear two dates i.e. the 'Date of tender' of challans and instruments and the 'Date of realisation' of proceeds of the instruments as specified in Annexure-V of the Pink Booklet.

(iv) Acceptance of Clearing Cheques: It is observed that some of the banks are reluctant to accept cheques drawn on other banks while receiving taxes resulting in practice of Chartered Accountants/Tax Consultants tendering their own cheques on behalf of their clients. As accepting cheques drawn on other banks will greatly facilitate the customers, banks are advised not to turn back customers who tender challans with cheques drawn on other banks.

(v) Do's and Don'ts : A list of Do's and Don'ts as given in the Annexure-IV of the Pink Booklet were not being supplied to the bank staff dealing with the Direct Tax collection work as required. The same may be issued to the branches.

7. Online Tax Accounting System (OLTAS)

(RBI/2004/131 (DGBA.GAD.No.1008/42.01.034/2003-04) dated April 1, 2004, RBI/2004/145 (DGBA.GAD.No. H-1068 /42.01.034/2003-04) dated April 16, 2004 & RBI/2004/184 (DGBA.GAD.No.H-1114/42.01.034/2003-04) dated April 29, 2004)

7.1 A High Powered Committee (HPC) was constituted by Reserve Bank for setting up OLTAS in January 2003. The HPC set up a Sub-Committee to suggest the Accounting Procedure for Online Tax Accounting System. The Accounting procedure duly approved by CGA and CAG was introduced for OLTAS w.e.f June 01, 2004.The new accounting procedure (Annexure) was forwarded to all agency banks on April 16, 2004. The salient features of the new accounting procedure are the introduction of a single copy challan with tear-off taxpayer's counterfoil, branding of acknowledgement stamp with unique serial number known as Challan Identification Number (CIN) on the single copy challan and on taxpayer's counterfoil. Tax payers are now able to view the tax paid by them by logging on to http://tin-nsdl.com. Further, the new file structure required by Income Tax Department was also forwarded to Agency banks for developing suitable software for the OLTAS.

7.2 Under the new procedure banks were advised to issue acknowledgement in respect of challans tendered with clearing cheques/drafts (i.e. other than cash and transfer cheques/drafts) only after the realization of such cheques/ drafts. Banks were further advised to issue paper token in respect of such challans indicating the date of tender and the date on which the counterfoil will be kept for delivery. The receiving banker was advised to return the tear-off portion of taxpayers' counterfoil on realization of such cheques/ drafts after branding with the rubber stamp acknowledging the payment with Challan Identification Number (CIN) comprising of the following:

            i. BSR Code number of the bank branch (7 digits)

            ii. Date of presentation of the challan (DD/MM/YY)

            iii. Serial number of the challan in that branch on that day (5 digits).

 

7.3 The tear off portion of the challans accompanied with cash or cheques drawn on the same receiving branch may be returned to the taxpayer on the same day with necessary acknowledgement by branding with the rubber stamp prescribed above.

7.4 All the non-computerised/ non- networked branches were advised to ensure that data pertaining to those branches be transmitted from its nearest computerized/networked branch to the Nodal branch and from Nodal branch to Link Cell electronically so that complete data pertaining to all the authorized branches of a bank throughout India are seamlessly transmitted to the Tax Information Network (TIN) hosted by NSDL.

7.5 It was further advised that the new accounting procedure under OLTAS will replace the existing procedure in so far as the sending of scrolls and challans to the Income Tax Department is concerned. It was also advised that except for the changes proposed in the OLTAS Accounting Procedure forwarded to banks, the instructions contained in the Pink booklet "Accounting System for Direct Taxes" (Updated upto June 30, 1999) will continue to be in force.

7.6 Further, need for transmitting data online to TIN in addition to the normal practice of sending paper scrolls and challans to the ZAO and Income Tax department was also emphasised.

7.7 It was suggested to banks that their Link Cells at Nagpur may be connected to TIN (NSDL) at Mumbai with a dedicated leased line to ensure secure two way communication.

8. Transmission of data to NSDL - Validation Checks

(RBI/2004/75 (DGBA.GAD.No. H-69 /42.01.034/2004-05) dated July 28, 2004,

DGBA.GAD.No.H-8649/42.01.034/2005-06 dated December 23, 2005)


 

8.1 Various types of errors noticed by National Securities Depository Ltd. (NSDL)/Income Tax Department in the data uploaded by banks have been advised to the banks. In particular, data entry errors noticed in respect of PAN/TAN Number, incorrect nodal scroll branch data, assessment year, absence or incorrect tax-payer's name, CIN Numbers, major head codes and amounts were brought to the notice of banks.

8.2 To counter the lacunae observed, it has been decided that each bank will incorporate the following validation checks with immediate effect in the OLTAS software for all Record Types:

                      (i) Value for the field NOD_BR_COL_SC_DT and NOD_BR_PYMT_SC_DT in RT01 and RT06 respectively should be between 01-06-04 and date of transmission (i.e. filename).

                      (ii) PAN/TAN cannot be of lesser than 10 alphanumeric characters. If its length is 10 then in case of PAN first five and tenth character of PAN should be alpha only, and sixth to ninth i.e. next four should be numeric. In case of TAN first three characters should be CTU code and fourth, tenth must be alpha and next five (fifth to ninth) should be numeric. Quoting of PAN/TAN is made compulsory w.e.f January 1, 2005.

                      (iii) Name field is always mandatory and it should have a combination of alphanumeric and dots only and it should be of more than one character (the name string should not be of dots and numeric or both. Alphabets must be there in main string). It is mandatory to transmit the full name of tax payer irrespective of the fact that PAN/TAN has been mentioned on the challan.

(iv) ZAO code number of a collecting branch is permanent and details of ZAO code numbers are available in the pink booklet published by the Reserve Bank. Nodal Branches must ensure that this ZAO code number is correctly mentioned in Record Type 01 and is not altered under any circumstances. It is advised that all the banks should save the code in the ZAO field in their OLTAS software as instances have been brought to the notice of RBI/Government where the same branch is mentioning different ZAO code on different dates of transmission.

8.3 In addition to the above validation checks, the following supervisory steps have to be taken by banks:

(i) Branch Managers of the collecting branches must ensure correctness of the name and amount captured from the challans. For this 'maker-checker' system of data entry must be adopted in all the bank branches.

(ii) All collecting branches must compulsorily transmit Record Type 01 and Record Type 02 (Summary Record), if there is collection on that day. In branches where there has been no collection during the day, Record Type 02 (NIL statement) is to be transmitted to the Nodal Branch. This would enable the TIN to accurately monitor the implementation of OLTAS.

                        (iii) At the Nodal Branch level supervision has to be made to ensure that all the collecting branches are transmitting the Record Type 01 and Record Type 02. They should also ensure that those collecting branches that have no collection transmit only Record Type 02 (NIL Statement) with MAJ_HD_CD=0 and TOT_AMT=0 to their respective Nodal Branch.

                        (iv) Branch Manager of Nodal Branch must ensure that the Major Head wise collection shown in the Nodal Branch Scroll of a particular date submitted to the ZAO, tallies with the corresponding totals in the OLTAS data transmitted to the Link Cell for submission to TIN. This exercise should be done in respect of all payments from June 1, 2004.

(v) All the banks at Link Cell level should maintain an error record of action taken on error records transmitted to TIN. This would ensure that all records which had initially been rejected by TIN due to some deficiencies are compulsorily retransmitted to TIN after removal of lacunae within 48 hours.

(vi) It is observed that the banks are entering wrong major head codes i.e. interchanging payments received under Major Head 020 for Corporation Tax or Major Head 021 for Income tax other than Corporation Tax. This leads to avoidable misclassification of payments and affects the reconciliation of accounts between the Income Tax Department and ZAO. In case of a valid PAN, the above validation can be implemented in the OLTAS software i.e. if 4th character (from the left) is 'C' then Major Head code must be 020.

8.4 Income Tax Department has also informed us that while transmitting assessment year data, banks were required to transmit the first part for normal as well as block assessment years; for example for the normal assessment year 2005-2006 the bank is required to transmit 2005 and for a block assessment year like 1997-2005, the year 1997 should be transmitted.

9. Sending daily scrolls by e-mail to ZAOs

(RBI/2006/295(DGBA.GAD.No.H-11140/42.01.034/2005-06 dated February 2, 2006)

Banks were advised of the revised format of electronic Nodal Branch Daily Main Scroll for Direct Tax Collection. The revised format (Annex III) is to be used to send the Daily Main Scroll electronically to all ZAOs pending receipt of physical challans/scrolls from all receiving branches.

10. Abolition of Sub-Agency Arrangements for Collection of CBDT Dues

(RBI/2004/326(DGBA.GAD.No.3278-3311/42.01.034/2004-05) dated Dec. 31, 2004)

It was observed that one of the major reasons for non-uploading of data under OLTAS is the existence of Sub-Agency arrangements with another prominent bank in the locality where the Sub-Agency bank concerned does not have sufficient number of branches for having its own Nodal Branch as per the norm then prescribed by CBDT. Due to non-compatibility or for other reasons, the data in respect of challans received by collecting branches under sub agency arrangements were not uploaded to TIN by the Principal Agency banks in many cases. With a view to avoiding delay and problems arising out of the sub-agency arrangements, it has been decided in consultation with Directorate of Income Tax (Systems), New Delhi to discontinue the Sub-Agency arrangement altogether. Banks were advised to designate their own Nodal branches wherever their branches were functioning under sub-agency arrangements.


 

11. Funds Settlement - Reporting to RBI, CAS Nagpur

(RBI/2005/466 (DGBA.GAD.No.H. 5801 /42.01.034/ 2004-05) dated May 13, 2005 & RBI/2005/406 (DGBA.GAD.H 5236/42.01.034/2004-2005) dated March 29, 2005)

11.1 Keeping in view the decision to switch over to settlement of funds on the basis of on-line data uploaded to TIN with effect from April 1, 2005, the existing system of reporting CBDT transactions to RBI, CAS, Nagpur has been reviewed. Accordingly, it was decided that agency banks will submit the CBDT figures to RBI, CAS, Nagpur separately through digitally signed e-mail (to be signed by a class II certificate holder). The CBDT figures reported to TIN as at 13.15 hours on week days and 12.30 p.m. on Saturdays would simultaneously be reported to CAS, Nagpur for funds settlement through digitally signed e-mail. The data mailed after the cut-off time would not be accepted by CAS, Nagpur under any circumstances.

11.2 Banks were advised that any rejections by the system at RBI, CAS will not be accounted for on the same day as it is presently being done after obtaining corrected revised advices from the Link Cells. The figures accepted by the system at CAS would be accounted for. The rejection report would be passed on to the Link Cell along with the daily input statement on the same day. Banks were advised to issue necessary instructions to their branches and the Link Cell in this regard.

11.3 It was clarified that the financial data file uploaded to CAS, Nagpur on any given date for funds settlement and the challan data relating to that particular settlement date uploaded to TIN should exactly match. Files rejected subsequently by NSDL, if any, due to validation errors etc. should be processed separately and re-uploaded. Banks were advised to ensure that challan data in respect of each and every challan deposited by the assessee is uploaded and duly accepted by TIN. Such re-uploading of files to TIN would not affect the funds settlement data. The requirement of complete reporting to TIN would be achieved if the data going from Link Cells to CAS, Nagpur and the relative challan data going to TIN are uploaded simultaneously.

11.4 Link Cells were advised to ensure that there is no mismatch in figures uploaded to CAS and TIN for a given uploading date.

11.5 Nodal Branches were advised to follow the instructions contained in paragraph 6 of the 'Accounting Procedure Relating to On-line Tax Accounting System (OLTAS)' meticulously and were advised to dispatch the Scrolls and Challans etc. on a day -to- day basis to Zonal Accounts Offices concerned.

12. Certain clarifications issued by the RBI for guidance to banks as regards OLTAS are reproduced below:

(RBI/213/2004(DGBA.GAD.NO.H-1169/42.01.034/2003-04) dated May 22, 2004 & RBI/2004/181 (DGBA.GAD.No. H-235/42.01.034/2004-05) dated September 15, 2004)

12.1 Challan Identification Number (CIN)

It was clarified that as per paragraph 1.3.3 of OLTAS Accounting Procedure (Annexure) running serial number would have to be given for all the challans tendered with cash, transfer cheques as well as clearing cheques on a particular day across all types of direct taxes. While the tear-off portion of the challan tendered with cash and transfer cheques (i.e. the cheque drawn on the collecting branch) needs to be returned to the tenderer with the prescribed rubber stamp indicating the date of tender, BSR code and CIN etc., the challans tendered with clearing cheques (i.e. drawn on other branches/banks) would have to be returned only on realisation of the instruments. The authorized official of the receiving bank branch was also required to sign the tear-off portion of the challan as well as original challan.

12.2 Banks were requested to visit Income Tax website (www.incometaxindia.gov.in) for Frequently Asked Questions (FAQs) on OLTAS.

13. Further, banks were advised to ensure full participation of authorized branches and ensure that every challan record is transmitted to TIN by every branch where tax collection has been made. It was reiterated that a NIL statement (Record type 02) may be transmitted to the nodal branch when there had been no tax collection during the day to enable TIN to monitor OLTAS properly. It was also emphasized that the data transmitted to TIN should be correct and complete and conforms to the stipulated procedures.

14. Banks were advised of the following critical short comings which were brought to the notice of RBI by Directorate of Income Tax:

(RBI/2004/164 (DGBA.GAD.No.H-170/42.01.034/2003-04) dated September 4, 2004)

14.1 Non capture of PAN/TAN by banks - It had been reported from many centres that even where the taxpayer has correctly quoted his PAN in full, certain bank branches were either not entering it or were entering it in an incomplete manner. In this connection, banks were advised that under the On-line Tax Accounting System (OLTAS) procedure/rules, it had been laid down that wherever the 10 digit PAN/TAN in the proper alpha numeric structure is quoted by the taxpayer the banks would only have to capture the PAN and the name of the taxpayer and not the address.

14.2 Non capture of the full name of the taxpayer - Perusal of the data uploaded to TIN indicated that many bank branches are still putting one or two characters in the name column of the taxpayer. In some cases even symbols and dots were used. Banks may please ensure capture of taxpayer's full name in OLTAS data.

14.3 Incorrect address field - The data analysed also reveals that the address field was not being captured properly by many bank branches. In many cases, just a few random alphabets or numbers were being entered which again indicated that the bank branches were not taking adequate care for full data capture. Banks were advised to take necessary corrective action.

14.4 Wrong reporting of Challan Identification Number (CIN) – It was observed that some bank branches were allotting a particular Challan Identification Number (CIN) on the taxpayer's counterfoil but entering a different CIN on the OLTAS data sent. As per OLTAS procedure/rules, CIN was to be allotted on date of presentation only. The CIN Number stamped on the taxpayer's counterfoil as well as on the main body of the challan should be transmitted to TIN.

14.5 Non uniform scroll data - As per the On-line Tax Accounting procedure rules, the scroll of a Nodal Branch for a particular day is to be identical for both the ZAO as well as for the data transmitted on OLTAS to TIN. It was, clarified that all collection data being sent to ZAO and TIN for a particular day must match both in respect of number of challans and Major Heads. Further banks were advised to ensure that each and every challan record is sent to TIN by every branch where collection has been made.

15. De-authorisation of bank branches for collection of Direct Taxes

(RBI/2005/412 (DGBA.GAD.No.H 5318 /42.01.034/ 2004-05) dated April 4, 2005)

15.1 With a view to streamlining the procedure for delisting of authorised bank branches under OLTAS, it has been decided in consultation with the office of Principal Chief Controller of Accounts (Pr CCA), CBDT, New Delhi that any proposal for deauthorisation of branches should be submitted by the Head Offices of the Agency banks to RBI, Central Office keeping in view the following parameters/ guidelines:

            i) The existing branch has not received any Direct Tax in the previous year (April-March)

            ii) The proposal for delisting of authorised branch has the approval of the Top Management of the concerned bank.

15.2 After the proposal is approved by RBI/Office of Pr.CCA, CBDT the concerned bank should give wide publicity to the effect that the specific branch will discontinue acceptance of taxes with effect from a specific prospective date and advise us accordingly.

16. File Segregation Utility developed by Tax Information Network

(RBI/2005/81(DGBA.GAD.No.382/42.01.034 /2005-2006) dated July 26, 2005)

Requests have been received from some banks that Tax Information Network (TIN) should not reject the entire file of OLTAS data received from a bank's Link Cell because of a few erroneous records. The banks have desired that TIN should accept the records which are with correct validations while rejecting the erroneous records. On the basis of the discussions CBDT had with NSDL (TIN) and banks, TIN had developed a File Segregation Utility which was advised to banks. (Annex II)

17. Accounting Procedure relating to crediting of CBDT collections to Govt. Account – Public Sector Agency Banks

(RBI/2005/411 (DGBA.GAD.No. H- 5287/42.01.034/2004-05) dated April 1, 2005, RBI/2006/150 (DGBA.GAD.No.H-6226/42.01.011/2006-07) dated October 10, 2006 and RBI/2007/235 (DGBA.GAD.No.H-11763 / 42.01.011 /2006-07) dated January 24, 2007, RBI/2007/286 (DGBA.GAD.No.13742 / 42.01.011 /2006-07) dated March 13, 2007)

17.1 It has been decided in consultation with Government of India to amend the instructions relating to the maximum number of days allowed for crediting tax collections to T+3 working days (where T is the day when money is available to the bank branch) instead of T+3 days (including Sunday and Holidays) with effect from April 1, 2005. For calculating working days holiday list of CAS, Nagpur will be reckoned.

17.2 It has been decided that the put through date, i.e. the date of settlement with the CAS, RBI shall be kept outside this existing time limit of T+3 working days.


17.3 Delayed period interest shall be imposed on banks for the delayed period and not from the date of transaction. In other words, the 'delay period' calculation will start from the day following the put through date.

17.4 The period of delay in a transaction of Rs.1 lakh and above shall attract delayed period Interest at Bank Rate + 2%. The Bank rate will be the rate as being notified by the RBI from time to time.

17.5 For the transaction below Rs.1 lakh each, the delayed period interest shall be levied at the Bank Rate for delays up to 5 calendar days and above 5 calendar days at the Bank Rate + 2 % for the full period of delay. The Bank Rate will be the rate notified by the RBI as applicable at the time of transaction.

17.6 It has also been decided by the Controller General of Accounts that every Principal Chief Controller of Accounts (Pr.CCAs), Chief Controller of Accounts (CCAs) and Controller of Accounts (CAs) in Ministries/Departments shall undertake Quarterly Review of all the remittances made by the banks. If the delay is found to be 5% and more with the bank as a whole or with any of its branches in two successive quarters, authorisation for the concerned bank or the branch will be forwarded to the CGA for review with the recommendations of Pr.CCA/CCA/CA. The banks are expected to build up their own internal control mechanism so that the preventive and corrective actions are taken by the bank for its branches well in time.

18. Accounting Procedure relating to crediting of CBDT collections to Govt. Account – Private Sector Agency Banks.

18.1 In the case of private sector agency banks the time limit for settling the transactions with CAS, Nagpur will continue to be T+3 days (including Sundays and Holidays). The period of delay will be counted from the date of receipt of the collection at the receiving branch (actual realisation of the money in the bank) till it is reported to Reserve Bank of India, CAS, Nagpur for credit to Government account. Delayed period interest will be recoverable from the banks regardless of the amount involved. Delayed period interest shall be levied at the prevailing Bank Rate+2%. (Bank Rate shall be notified by RBI from time to time).

18.2 Further, the instructions given at Para 17.6 above will also be applicable to private sector agency banks.

19. Drawing of Cheques by Assessees- Payees Name

(DGBA.GAD.No.H-8294/42.01.037/2005-06 dated December 14, 2005)

With a view to obtaining uniformity in the Payee's name while drawing cheque/DD by assessees for depositing challans for Direct Tax Payment under OLTAS, it has been decided by the Income Tax Department to print the following instructions on the reverse of the Income Tax Challan:

"Tax payer may please draw/issue cheque/DDs towards payment of Income Tax as under:

"Pay….. (Name of the Bank where the challan is being deposited)- A/c Income Tax".

Banks were advised to bring the change to the notice of all their authorised branches.

20. New Major Heads/Challans

(RBI/2005/39 (DGBA.GAD.No.H-42 /42.01.034/2005-06) dated July 4, 2005)

Banks were advised of the revised challan formats introduced by Government of India which were necessitated by the introductions of two new taxes i.e. Fringe Benefit Tax and Banking Cash Transactions Tax. Consequent changes/ rationalization made to Major Heads and Sub-Minor Head of Accounts by Income Tax Department are given below:

CHALLAN NO.ITNS – 280

The Challan is for the payment under the two Major Heads i.e. (a) 0020 Income-tax on Companies (Corporation Tax) and (b) 0021 Income-tax (other than Companies). It should now be possible for taxpayers to pay taxes for assessment years other than consecutive assessment years. For example, in the case of assessments for block period (more than one consecutive assessment year), the assessment year field in the bank's software may be modified to accept payments for a period other than consecutive assessment year for example payments for A.Y. 1991-97, 1992-99, 1993-99 etc.

CHALLAN No.281

The challan is meant for payment of TDS (tax deducted at source)/TCS (tax collected at source). It has two Major Heads i.e. (a) 0020 for company deductees and (b) 0021 for non-company deductees. The challan has two Minor Head Codes which are to be ticked by the tax payer (a) TDS/TCS payable by tax payer (Minor Head -200) (b) TDS/TCS on regular assessment (raised by Income-tax Department (Minor-Head - 400).

The new three digit codes Sub-Minor Heads now introduced in the challan are as under:

Section

Nature of Payment

Code

206C

Collection at source from Alcoholic Liquor for Human Consumption

6 C A

206C

Collection at source from Timber obtained under Forest lease

6 C B

206C

Collection at source from Timber obtained by any Mode other than a Forest Lease

6 C C

206C

Collection at source from any other Forest Produce (not being Tendu Leaves)

6 C D

206C

Collection at source from Scrap

6 C E

206C

Collection at source from contractors or licensee or lease relating to Parking lots

6 C F

206C

Collection at source from contractors or licensee or lease relating to Toll Plaza

6 C G

206C

Collection at source from contractors or licensee or lease relating to mine or quarry

6 C H

206C

Collection at source from Tendu leaves

6 C I

 

CHALLAN NO. 282

This challan is for the payment of a number of taxes. The changes introduced in this challan are as under:

            a) Securities Transaction Tax has been renumbered as Major Head 0034 in place of the earlier Major Head 0025.

            b) Wealth-Tax - Major Head 0032 has been included in this Challan. Earlier this Major Head was in Challan No.280.

 

CHALLAN NO.283

This is a new challan introduced. It is for the payment of (a) Banking Cash Transaction Tax - Major Head 0036 and (b) Fringe Benefit Tax - Major Head 0026. The valid Minor Head for both these categories of taxes are (i) Self Assessment Tax, Minor Head - 300 and (ii) Tax on Regular Assessment Tax - Minor Head 400 and (iii) Advance Tax, Minor Head-100.

Banks may please arrange necessary modification in OLTAS software and bring the above changes to the notice of all the branches collecting direct taxes to enable the branches to accept payment of these taxes with immediate effect.

21. Verification of PAN/TAN

(RBI/2006/55(DGBA.GAD.No.H-161/42.01.034/2005-06 dated July 7, 2006))

It has since been decided that the Income Tax Department through their Regional Computer Centre would provide a CD, containing the PAN/TAN master, and the name of tax payers of that region to the nodal branches of all agency banks which will be updated on a quarterly basis. Banks were advised to replicate the copies of the CD for internal distribution to their branches along with a simple data retrieval software which may be used for cross verifying the PAN/TAN quoted by the tax payer in the challan tendered. Banks were also advised to explore the possibility of developing a software whereby the PAN/TAN and the name provided in the CD gets captured by their data entry system automatically thereby eliminating separate data entry of PAN/TAN. If the tax payer's PAN/TAN is not available in the CD, the customer may be requested to produce a copy of the relevant PAN/TAN card or any other document to indicate the correctness of the PAN/TAN. Banks are not required to retain these documents used for the purpose of verification in cases where the PAN/TAN of the tax payer is not available in the CD supplied by Regional Computer Centre. Most importantly, banks were advised not to accept challans without a visual check by the receiving official concerned to ensure that the challan contains PAN/TAN in the valid 10 digit character.

22. Compulsory Quoting of Permanent Account Number (PAN)/Tax Deduction Account Number (TAN) on Challans from 1/1/2005

(RBI 2004/300 (DGBA.GAD.NO.H-2532-65/42.01.034/2004-05) dated December 14, 2004 &

RBI/2005/265(DGBA.GAD.NO.H-8824/42.01.034/2005-06 dated December 28, 2005)

With a view to ensuring correct and prompt credit to tax payers, Central Board of Direct Taxes (CBDT), Government of India have decided to implement the provisions for mandatory quoting of PAN/TAN on Challans from January 1, 2005. Accordingly, no payment of taxes will be accepted by bank branches unless the PAN of the tax payers is quoted on Challans ITNS 280 & 282 or TAN of the deductor on Challan ITNS 281, as the case may be. The branches may display a notice prominently stating that 'Quoting of PAN/TAN on Challans is compulsory from 1/1/2005' in the branches and not to accept challans without PAN/TAN from that date. The procedure for obtaining PAN/TAN is available in the website of Income Tax Department (http://www.incometaxindia.gov.in or http://www.tin-nsdl.com). The branches may guide the assessees to obtain PAN/TAN before depositing the tax. The facility of downloading the challan form No. 280 & 281 with pre-printed PAN/TAN number may also be given wide publicity through your designated branches.

23. Banking Cash Transaction Tax (BCTT)

(RBI/2005/43(DGBA.GAD.No.H-76/42.01.001/2005-06) dated July 5, 2005)

23.1 Banks were advised the procedure to be followed as regards levy of Banking Cash Transaction Tax on the cash withdrawal by the Government departments. Extract of the same is reproduced below:

"Government of India has introduced a new levy of 0.1%, called as Banking Cash Transaction Tax (BCTT) through Finance Act, 2005 which has come into effect from June 1, 2005. The BCTT is levied on the value of taxable banking transactions which have been defined as under:

            a) Withdrawal of cash (by whatever mode) exceeding a specified limit on any single day from an account other than a savings bank account with any scheduled bank.

            b) Receipt of cash exceeding a specified limit from any scheduled bank on any single day on encashment of one or more term deposits, whether on maturity or otherwise.

 

23.2 The BCTT is also payable, among others, by an office or establishment of the Central Government or a State Government. Accordingly, Central Government Offices or establishments will be liable to pay the BCTT on the amount of cash withdrawn by them for their use, if the amount withdrawn by them is in excess of Rs.1, 00, 000/- (Rupees one lakh), in a single day from a single account.

23.3 In this connection, Government of India has observed that deducting the BCTT from the cheques' amounts drawn by Government Departmental Officers by Agency Banks is not correct. Banks are, therefore advised to stop the practice forthwith.

23.4 In order to enable Banks to recover the tax from the Government departments, banks are advised to directly debit the Government account through the payment scrolls. The BCTT may be shown just below the relevant cheque amount in the payment scroll, indicating in clear words "Banking Cash Transaction Tax".

23.5 Insofar as the reporting and settlement of the collections with the Reserve Bank of India, CAS, Nagpur and ZAOs of CBDT is concerned, banks will follow the procedure already prescribed for the purpose with respect to "Direct Taxes"."

24. Obligation of Scheduled Banks to furnish information on Banking Cash Transaction Tax (BCTT)

(RBI /2005/ 85 (DGBA. GAD. No. H- 414 /42.01.001/ 2005-06) dated July 30, 2005)


 

24.1 As per Rule No. 5 of the Government Notifications No. 156/2005, dated May 30, 2005 scheduled banks are required to furnish a statement of number of taxable banking transactions entered into and Banking Cash Transaction Tax collected during the month on or before the expiry of the month immediately following the relevant month on a computer media.

24.2 Banks may, therefore, furnish the information in the manner and media as prescribed in the Rules at the address mentioned below:

Directorate General of Income Tax (investigation)

E-2, ARA Centre, 3rd Floor, Jhandelwalan Extension

New Delhi 110 055

Banks may download the above Notification and forms from the website www.taxmann.com.

25. On Line Tax Accounting System (OLTAS)-

Improvement in Data Quality

(DGBA.GAD.No.3774/42.01.034/2007-08 dated October 9, 2007 RBI/2007/206 & DGBA. GAD. No.6212/42.01.034/2007-08 dated December 6, 2007)

25.1 Discrepancies in challan details uploaded to TIN

It was brought to the notice of banks that the OLTAS data uploaded to TIN by them do not match with the relative data submitted through TDS/TCS returns submitted by deductors. Common irregularities observed were:

(i) Date of Realisation is digitized as Challan Tender Date in the data uploaded through OLTAS.

(ii) Uploading of incorrect Challan Serial Number, Major Head, PAN/TAN etc.

(iii) Challan Serial No. not Stamped on challan counterfoil.

(iv) Amount indicated against single challan bifurcated into two amounts and reported in two challans.

Banks were advised to avoid the above errors and be more careful while capturing and uploading OLTAS data.

25.2. Data Quality Concerns

In order to achieve accuracy in reporting PAN & CIN to TIN the agency banks were advised to:

            i. use bulk PAN verification facility from TIN-NSDL site;

 

            ii. insist on proof of PAN whenever necessary and

 

            iii. ensure CIN given to the customer is the one uploaded to OLTAS. Care to be taken especially with reference to 'date of tender'.

 

26. Introduction of Computerised Receipts and Improve in Data Quality

(RBI/2008/328 & DGBA GAD. No.H.12070/42.01.034/2007-08 dated May 22, 2008)

The Agency banks were advised to issue computerized receipts for challan payments of OLTAS transactions comprising of relevant data as per prescribed proforma i.e. annex A-IV-I & II w.e.f June 01, 2008. The agency banks further advised to follow additional guidelines as under:

            i) Maker Checker System of Data Entry: Maker Checker System in which the data entry by one is checked by another to exclude the possibility of wrong data entry, may be strictly followed.

            ii) Software Alert: To minimize the data entry error, the data entry software in the collecting branches should provide alert message where PAN/TAN is not entered or structurally invalid data is entered or PAN is entered in the column meant for TAN or where there is mismatch between minor head and assessment year etc.

            iii) Software validation: You may ensure that the software validations issued by Income Tax Department have been incorporated in your system.

            iv) Quality assurance at Bank level: Quality assurance in respect of collection of Government Tax is expected from all agency banks.

            v) Re-upload of rejected file: the OLTAS data file may be validated through the file validation utility (FVU) before uploading the same to TIN to eliminate rejection of data file at NSDL.

 

27. Cut off time for e-Payment transactions pertaining to Government Revenue

(RBI/2008/275 & DGBA. GAD. No.10577/42.01.038/2007-08 dated April 3, 2008)

Banks authorized for e-payment of CBDT revenue were advised that payment under OLTAS received up to 8.00 p.m. may be treated as received on the same day and those received thereafter be treated as received on next working day.

28. Mandatory Electronic Payment of Tax by Certain Categories of Taxpayers w.e.f. April 1, 2008

(RBI/2008/280 & DGBA. GAD. No.H.10875/42.01.038/2007-08 dated April 10, 2008)

CBDT has made electronic payment of taxes mandatory for the following categories of taxpayers:

            a. A Company

            b. A person (other than a company) to whom provisions of Section 44AB are applicable

 

Banks were, therefore, advised to instruct their branches:

                      i) to identify the status of the corporate taxpayers from the name. The 4th digit of PAN of all corporate asseessee would be "C". Hence physical challans from such asseessee should not be accepted across the counter.

 

                      ii) To accept physical challans at the bank counters from taxpayers under Sec. 44AB of IT Act as the responsibility of making e-payment rests primarily with the taxpayers.

 

                        iii) to make available acknowledgement for e-payment immediately on the screen.

                        iv) to ensure that the transaction id of e-payment is reflected in the bank's statement.

                        v) to display on its e-payment gateway page, the official/s to be contacted in case the taxpayer faces any difficulty in making the payment, completing the e-payment transaction, generating the counterfoil etc.

                        vi) to give ITD and NSDL a list of officials with contact particulars to be contacted if required for any problems faced by ITD or tax payers.

 

(RBI/2008/321 & DGBA. GAD. No. H. 11895/42.01.038/2007-08 dated May 15, 2008)

The Agency Banks were supplied a CD containing area-wise PAN and names of taxpayers coming under Section 44AB of IT Act for the financial year 2007-08 and to take following action in case of submission of challan with cheque by taxpayers covered under Section 44AB of IT Act, which can be verified from the CD containing area wise PAN and names of the taxpayers coming under Section 44AB:

                        i) Request the taxpayer to route his payment through e-payment mode.

                        ii) If he asserts his inability to do so, accept the cheque with a warning that it will not be accepted for the next payment and he may be liable for proceeding under the Act.

 

                        iii) Help the taxpayer to open net- banking account in the branch.

                        iv) A short write up and steps to be followed to make e-payment (as per annex IV) for the knowledge of tax payers was also provided to the banks.


 

29. Permissible Period of Remittance of E-payment of Government

Transactions – Private Sector Banks

(DGBA.GAD.No.H.551/42.01.011/2008-09 dated July 18, 2008)

The remittance period in respect of Private Sector Banks and IDBI Bank for all Government transactions including EASIEST and OLTAS received through e-payments would be T+1 working day (including put through date) w.e.f. August 1, 2008.

30. Permissible Period of Remittance of E-payment of Government

Transactions – Public Sector Banks

(RBI/2008/09/97-DGBA.GAD.No.H. 549/42.01.011/2008-09 dated July 18, 2008)

The remittance period of all Government transactions including EASIEST and OLTAS received through e-payments by Public Sector Banks would be T+2 working days (excluding put through date) w.e.f. August 1, 2008 and T+1 working day (excluding put through date) w.e.f. January 1, 2009.

                        31. Recovery of Interest from Public Sector Banks on delayed remittances of Government Receipts into Government Account

(RBI/2009/463-DGBA.GAD No. H-9284 /42.01.011/2008-09 dated April 28, 2009)

(i) Applicability of exclusion of put through date for the transactions (relating to revenue receipts) affected during the period 1/5/2005 to 31/12/2006 for the cases in which penal interest has already been paid:

As per the extant instructions, the 'Put Through Date' was excluded from the prescribed remittance norms for calculating delayed period interest for remittance of Government revenues and these instructions were made applicable in pending delayed period interest cases where the banks had not paid the interest. It was decided by Controller General of Accounts to extend the benefit of exclusion of the 'Put Through Date' from the time period calculated for remittance of Government receipts to those banks also which had paid the penal interest during the period from 1/05/2005 to 31/12/2006 on the instructions existing at the time they made the payments. The excess payment of penal interest paid by the banks will be adjusted against the subsequent claims of delayed period penal interest against them.

                         

(ii) Permissible period for remittance of Govt. revenues into Govt. account for outstation transactions under Electronic Accounting System in Excise and Service Tax (EASIEST):

It has been decided that a maximum period of T+5 working days (excluding put through date) for outstation transactions will be allowed. This dispensation will not be applicable on e-payments (payment made through internet) for which separate instructions have been issued vide our circular No. RBI/2008/09/97 dated July 18, 2008.

(iii) Levy of petty amount of penal interest on delayed remittances of Government receipts:

It has been decided that the petty claims of delayed period penal interest involving amount of Rs.500/- or below, will be ignored and excluded from the purview of penal interest w.e.f. January 1, 2008.

(iv) Waiver of penal interest due to teething problems experienced by dealing branches during the initial period of OLTAS:

Considering the various problems which had arisen during the initial period of implementation of OLTAS before the system stabilized, it has been decided to exempt the six quarters (i.e. 1/04/2005 to 30/09/2006) from the purview of penal interest.

Further, these instructions will not be applicable to remittance of funds under the Deposit schemes viz. PPF/SCSS etc. of Ministry of Finance.

 

Annex I

ACCOUNTING PROCEDURE RELATING TO ON-LINE TAX

ACCOUNTING SYSTEM (OLTAS)

----------------------------------------------------------------

1. Procedure for acceptance of taxes at the receiving branches

1.1 A taxpayer can pay direct taxes at any authorised branch of the authorised bank either in cash, direct debit to account or by a cheque/draft drawn on the same bank or another bank/branch at the same centre where the payment is made. The payment of tax by outstation cheques/drafts can also be made at any authorised bank, or through an electronic means of remittance to the authorized bank / branch. For every payment there should be a challan in the prescribed format. The challan format is a single copy challan with the main challan at the top and the taxpayer's counterfoil at the bottom of the challan (Specimen at Annexure 'A').

1.2 At the counter of Receiving Bank Branch

The receiving clerk/ teller of the receiving branch will have to check up the following points while accepting the payment: -

a. Whether main portion of the challan and the taxpayer's counterfoil form have been filled in properly and the amount and major head of account to which the amount is to be accounted /credited is correctly recorded therein;

b. Whether details of the Permanent Account Number (PAN) or Tax Deduction Account Number (TAN), name and address of the taxpayer, assessment year and nature and type of payment are properly filled in. The amount should be written correctly both in words and figures.

c. Whether the Permanent Account Number (PAN) / Tax Deduction Account number (TAN) has been quoted in the challan at the prescribed place. U/s 139 A (5) (b) of the Income Tax Act, quoting of PAN is mandatory. Similarly, u/s 203A of the Act, quoting of TAN is mandatory. This number, as quoted by the taxpayer should be validated (checked to see whether it is in conformity with the valid PAN/TAN structure) and the designated banks accepting tax payment should ensure that the challans for payment are accepted only when a valid PAN is quoted in the challan. However, where the taxpayer indicates that he has already applied for allotment of PAN or TAN but has not yet been allotted the same, the tax payment challans may be accepted by the bank provided the tax payer indicates PAN/TAN application number in the challan. In such cases it should invariably be ensured that the full address of the taxpayer has been mentioned in the challan.

1.3 After scrutinizing the challan and satisfying himself that the amount of cash, cheque or draft tendered agrees with the amount shown in the challan, and also that the cheque is not post dated/stale the receiving teller or counter-clerk of the branch will issue a paper token to the tenderer to facilitate delivery of the counterfoil receipt to him. In the case of challans deposited with cheque or draft drawn on other bank branches, the counterfoil receipt will be issued only on realization of the amount of the cheque or draft and hence the paper token should bear the date on which the same will be available.

1.3.1 Challans tendered with Cash

A challan tendered with cash, if found in order after scrutiny, will be stamped 'CASH RECEIVED'. The bank will also stamp both the main portion and the taxpayer's counterfoil of the challan with a stamp mentioning the name of the bank & branch, the BSR code the branch (7 digits), date of deposit (DDMMYY) of the amount and unique serial number of the challan (5 digits). The stamp will be impressed on both the main portion as well as the taxpayer's counterfoil of the challan. Care must be taken to ensure that the impression of the receipt stamp is clear and legible.

An authorized official of the branch will sign in full the taxpayer's counterfoil of the challan and initial the main copy of the challan having received the amount. In the taxpayer's counterfoil, the amount received will be indicated in both words and figures. The receipted taxpayer's counterfoil will be returned to the tenderer and the main copy will thereafter be passed on for scrolling in the Receipt scroll.

1.3.2 Challans tendered with Cheque/Draft

A challan tendered with cheque/ draft will be branded with a 'double date stamp' to indicate the date of tender of the instrument as well as the date of realization thereof. It may be possible that some branches might be following the practice of branding the challans with an inward date stamp as soon as the challans are tendered over the counter. In that case the double date stamp may not be necessary. However, it will be ensured that the inward date stamp is invariably branded on both the main copy and the taxpayer's counterfoil of the challan.

The checking official will initially ensure that there is no difference between the amount of cheque/ draft and the amount recorded in the challan by the tenderer. The cheque/ draft will thereafter be sent for realization. Subsequently, on realization of the cheque/draft, the date of realization will be indicated on the double date stamp or in the space in the challan as the case may be. The bank will also stamp both the main and the taxpayer's counterfoil of the single copy challan with a stamp mentioning the name of the bank & branch, the BSR code the branch (7 digits) date of deposit (DDMMY) of the amount and unique serial number of the challan (5 digits). After signing the challan for having received the amount, the taxpayer's counterfoil will be returned to the tenderer against the surrender of the token.

1.3.3 Numbering of Challans

Running serial number will be given for all the challans (both paid by cash and by cheque) for each day. It must be ensured that the serial number on each challan issued on a particular day should be unique to trace it subsequently. The bank must therefore ensure that the serial numbers given to the challans deposited with cash do not overlap with the serial numbers given to the challans against which cheques have been realised on that day.

Counterfoil of the challans tendered along with cash and cheque/draft payable at the same branch will be returned to the tenderer duly receipted at the counter. The challans tendered with cheques/drafts drawn on a different branch of the same bank or any other bank situated at the same centre, the tax-payer's counterfoil will be returned duly receipted not later than the working day following the day fixed under the Rules of 'Local Bankers' Clearing House' for return of unpaid instruments of any day's clearing.

1.4.1 In case of challans tendered with cheque/ draft, the date of realization of the cheque will also be stamped on the main portion of the challan, which will be retained at the bank for onward transmission to Zonal Accounts Office (ZAO) along with the Receipt Scroll. Although as per the Income Tax Act the date of presentation of cheque/ Demand Draft realized will be treated as date of payment of tax, the cheque/ Demand Draft will be scrolled only after realization.

1.4.2 Double Date on Receipted Challan

The main portion of the challan through which a cheque/ draft is deposited will, therefore, have two dates as under:

i) Date of tender : DDMMYY (in the rubber stamp acknowledgement)

ii) Date of realization: DDMMYY (at the place indicated in the challan)

In case of cash tender the 'Date of tender' and 'Date of realization' will be the same.

1.4.3 The collecting bank will not issue receipt in any other format.

2. Preparation of Scrolls by the Collecting Branch

2.1 A running serial number will be given to all the challans received at a bank branch counter on each day against which cash payments have been made or cheques/ drafts have been realized on that date.

2.2 All the challan fields such as name and PAN, the serial number, date of deposit and BSR code of the branch are required to be captured when the challan is deposited by the tax payer at the bank counter. The data structure of the fields of the challan for which data has to be captured and transmitted will be as informed to the banks by the Income-tax Department. Permanent Account Number (PAN) and the name of the taxpayer will invariably be incorporated in the Receipt & Payment Scroll.

2.3 At the end of customer banking hours, the bank branch should identify all those challans against which payment has been received in cash for the day or for which payments by cheque/draft have been realised for the day. As the details of all these challans is already in the bank's computer system, the branch should generate a file containing all the challan data for which payments have been realised for that day and transmit it to its Nodal Branch for onward transmission to the Income Tax Department's TIN through the banks' Link Cell. However, the non- computerized/ non- networked authorized branches should ensure that data is transmitted from it's nearest computerized/ networked branch to the Nodal Branch. It should be ensured that no challan for which payment has been realised on that day is left out. A running scroll serial number extending through a financial year (1st April to 31st March) will be given to the records relating to each type of tax (major head) which are transmitted on a particular day. The complete data structure of records and the file which is to be transmitted by the bank to the Department will be in the format prescribed by the Income-tax Department. The collecting branch will in no case alter the online data file at its end after it has been transmitted to the Income Tax Department.

2.4 Treatment of Clearing Returns

The collecting branch should also identify all those challans against which instruments were returned unpaid. Such instruments along with related challan should be kept separately in the bank for taking further necessary action as deemed fit.

2.5 The collecting branch will also generate separate printouts of the scrolls in Form and summary in Form based on the type of tax (major head-wise) on a daily basis from the challan data on its computer which has been transmitted to the Income-tax Department. The same running serial number extending through a financial year (1st April to 31st March), which was given to the scrolls transmitted for the relevant day, prefixed by the appropriate abbreviation of the type of tax (major head) concerned, will be printed on the scroll. The collecting branch will in no case generate any printed scrolls or summary from data which is changed in any manner from the data earlier transmitted to the Department. Thus the scrolls generated by the branch will exactly match the scrolls generated by the RCC from the data transmitted to the Department's TIN on-line by the bank. Thereafter, the branch will prepare a set of computer printed summary and receipts scrolls and attach with each scroll the physical challans arranged in the same serial order in which they are entered in the scrolls. At the beginning of the next working day, the receiving branch will forward the same to the Nodal Branch for onward transmission to the ZAO.

2.6 Transmission of Error Records

In case of any error by the collecting bank branch in reporting the amount of payment made by a taxpayer or major head of payment, the bank will transmit the corrected information on-line to TIN through an error record, the format for which will be as prescribed by the Income-tax Department. Rectification of the errors in the amount and the head of account will also be reported to ZAO through 'Error Scroll" to be sent through Nodal branch. Only the amount of tax payment as reported by the bank to the TIN will be accepted by the Income-tax Department as the payment made by the taxpayer.

3. Procedure for Payment of Income Tax Refund Orders (ITROs)/ECS

3.1 Direct tax refund work is entrusted to only one branch of an authorized bank generally Reserve Bank of India, State Bank of India or its Associate Banks at an ITD centre / a District. The Refund Orders will be presented to the branch by the taxpayer for transfer to his account with the same branch. Alternatively, it might be received through clearing. The specimen signatures of the officers of the Income-tax department who are authorized to draw refund orders will be sent to the paying branches concerned in advance by the Income-tax authorities. The specimen signature will be duly certified by an officer of the Income-tax Department whose specimen signature is already on record with the branch. Any change in the authorised official will be advised to the branch concerned immediately. The relieved officer will attest the specimen signature of the relieving officer. While passing the refund orders for payment, the passing official should exercise utmost care apart from the precautions usually exercised by the banks in connection with payment of Negotiable Instruments, the instructions issued by Controller General of Accounts as well as Reserve Bank from time to time. The payee is required to affix his signature in the space provided for 'Claimants signature' on the reverse of the Income Tax Refund Order (ITRO).The procedure relating to Refund Advices will continue as at present except that advices of paid ITROs and printed payment scrolls will no longer be sent by the bank to the Income-tax Department.

3.2 As in the case of receipts, refunds are required to be classified by the paying branch according to the type of tax under which the refunds are made. Separate major head wise payment records will be maintained in respect of payment of ITROs.

3.3 Direct tax refunds can also be credited directly to the taxpayer's bank account through Electronic Clearance Scheme (ECS) of RBI. In order to avail of this facility, the taxpayer gives a mandate by mentioning type of his bank account (Savings or Current), account number and bank branch code (9 digit) in his Return of Income. After processing of the taxpayer's Returns and determination of the refund by the Assessing Officer, all taxpayer's refunds (in which credit through ECS has been sought) in the jurisdiction of an RCC are automatically consolidated on the computer system at the RCC. All this refund data is downloaded, encrypted and copied onto a magnetic media (floppy or rewriteable CD) or transmitted electronically. This is sent by the RCC to the local ZAO as well as refund issuing branch of RBI or SBI. After validating the data in the file, the bank debits the Income-tax Department Account for the total amount of the refunds and thereafter issues instructions through clearing to the different local braches of the banks where the taxpayer's accounts are located to credit the taxpayer accounts with the amount intimated by the Department. This single debit to the Department's account appears in the payment (refund) data transmitted by the bank to the Income Tax Department for that day. In case any of these credits to the taxpayer's accounts are not effected due to reasons like closing of the account etc., the same is later accounted for by a separate minus debit entry for ECS Return in the Income Tax Department's account and is intimated to the Income Tax Department through the payment (refund) data transmitted for that particular day. The files in the electronic media (floppy or rewriteable CD etc.) are returned along with the computer printed payment (refund) scroll to the ZAO while the same data is transmitted online by the bank to the Income Tax Department through the Income Tax Department's Tax Information Network (TIN).

4. Preparation of Payment (Refund) Scrolls

4.1 The procedure for preparation of payment scrolls will be the same as the procedure applicable to receipts scrolls.

4.2 The scrolls will be made into set similar to the set relating to receipts except that instead of the challans, the paid Refund Orders will accompany the scrolls. The entire data regarding the paid refund vouchers will be transmitted electronically by the paying bank to the Link Cell for onward transmission to the Department's TIN while the physical scrolls with the paid Refund Order will be forwarded to the ZAO through the Nodal Branch. If the Nodal Branch is not locally situated, all the above documents (receipt/payment scrolls etc.) should invariably be sent by Registered Post.

4.3 In the case of ECS Refunds, the data will be transmitted on-line to the Link Cell and subsequently to the Income Tax Department while the same ECS detail on electronic media will be sent to the local ZAO by Paying Bank through the Nodal branch

5. Loss of Counterfoil by the taxpayer

5.1 In the event of loss of receipted challan counterfoil by the depositors, the bank branches may, on receipt of a specific request in writing for issue of a certificate of credit from assessees, issue the same to the depositor based on their record after satisfying themselves about the bonafides of the applicant in each case and may charge a nominal fee at its discretion. The certificate should mention the challan details i.e. amount, bank name and branch, BSR Code and Date of Deposit of cheque/cash, major head, challan serial number, date of realisation of cheque /date of deposit of cash and Collecting branch scroll number and date on which details of tax payment have been transmitted earlier.

6. Functions of Nodal Branch

6.1 Nodal Branch will be responsible for the prompt and accurate transmission, accounting of the collections/refunds reported to it daily by all the receiving branches under its jurisdiction (including its own receipts). It will also be responsible for prompt remittance of the collections of all the receiving branches linked to it (including its own collections) to the Government Account at RBI, CAS, Nagpur. It will also be responsible for reconciliation of figures with the ZAO.

6.2 On receipt of on-line data regarding all the challans realised for a particular day from the Collecting Branches, the Nodal Branch will take the following action on day-to-day basis:

a. It will collate the challan data on its computer system and transmit the data in the format prescribed by the Income Tax Department to its Link Cell for onward transmission to the Departments TIN on the same day after giving a common Nodal Branch scroll number and date to all the challan records being transmitted on that day.

b. It will also generate a copy of the summary and main scroll based on the computer data in a floppy or other media (as informed by ZAO) and transmit it to the ZAO on the next working day.

c. On receipt of the hard copy of the computer-generated Branch scrolls from the collecting branch, the Nodal branch will validate that these computer-generated branch scrolls exactly match the data transmitted earlier by the collecting branches. It will consolidate these computer printed Branch scrolls (with challans) received from all the branches including its own along with the main scroll by stitching the scrolls together Major head-wise. It will also generate a computer printout of the Major head-wise Main scrolls and Summary. It will then forward these (with challans) to the ZAO concerned on a daily basis.

d. Second set of scroll prepared in the same manner without challans as discussed at (c) above will be retained by the Nodal branch for its record.

e. The Nodal branch will also similarly generate computer printed separate main scrolls for payments (i.e. refunds), and forward them along with the paid ITROs to the ZAO. It will also forward ECS refund details on electronic media to the local ZAO. The refund data (in respect of paper ITROs and ECS refund) will be transmitted on-line by the Nodal Branch to TIN through the Link Cell. It will retain the advice/advices of the paid ITROs.


f. During the first 15 days in April every year, the nodal branches will transmit and prepare two separate sets of scrolls – one normal scroll pertaining to April transactions and the other one pertaining to March transactions (which means scrolls of cheques / drafts / ITROs tendered and cleared upto 31st March by receiving branches and sent to the nodal branch subsequent to 31st March but before 15th April) - these will be scrolled by nodal branch as March residual account. The nodal branches will intimate the link cell at Nagpur for inclusion of these transactions as March transactions. The nodal branches will send another scroll for April transactions prominently indicating the month of account. Any cheque/draft tendered on or before 31st March and realised on or after 1st April will be treated as part of the April transactions. However, in light of the instruction that data for all challans for which payment has been realised on a given day should be transmitted online to the Income Tax Department on the same day, separate March residual scroll should only be needed in exceptional cases.

g. The nodal branch will pass on the consolidated amount accounted by it to its Link Cell on day-to-day basis.

7. Crediting the tax collection to Government Account

7.1 The Nodal Branch acts as a pooling centre for all the receiving branches coming under its control and it is responsible for reporting of the transactions (along with all the related documents i.e. Challans and scrolls) to the ZAO. It is also responsible for transmitting the challan data for all these transactions to its Link Cell at Nagpur for onward online transmission to the Income Tax Department as well as for crediting the amount collected to Reserve Bank of India (Central Accounts Section or CAS), Nagpur.

7.2 The Nodal Branch will prepare a daily memo and send it on a daily basis to its Link Cell at Nagpur (GAD, Mumbai in case of SBI) which in turn will make a daily settlement with RBI, CAS, Nagpur.

7.3 The Link Cell of banks at Nagpur will consolidate the challan data received from the Nodal Branch for transmission to the Department's Tax Information Network (TIN) and will also monitor the daily receipts and check the accuracy of the daily memos received from the Nodal Branches. The Link Cell will then transmit the daily memos to CAS, RBI, Nagpur.

7.4 The Nodal Branches of the banks will carry out monthly reconciliation with ZAOs of the amount settled by them with their Link Cell at Nagpur. On the basis of their records the ZAOs will verify the statements received from the Nodal Branches both major head-wise and Nodal Bank-wise. In case of any discrepancy, the Nodal Branch will carry out the corrections immediately and adjust the difference in the amount already credited / debited to the CBDT's account through its Link Cell at Nagpur under information to the ZAO.

7.5 For the purpose of final reconciliation of the transactions with ZAOs and the Link Cell, the CAS, RBI, Nagpur will generate a monthly statement and furnish the same to ZAO and the Link Cell of the banks. RBI, CAS, Nagpur will furnish by 20th of the following month, a monthly analysis indicating major head-wise receipts / refunds etc. to the CCA, CBDT.

8. Payment of interest on delayed transfer of tax collections

8.1 The tax collections effected by the designated branches of the authorized banks have to be credited to the Government Account, promptly on day-to-day basis. The maximum number of days allowed for crediting tax collections to Government Account at CAS, Nagpur is as under:

            i. T+3 working days for all banks except private sector banks

            ii. T+3 days for private sector banks and IDBI Ltd

 

8.2 If there is any delay beyond the period prescribed above, the banks are liable to be charged interest for delayed period. The interest for delayed remittance as mentioned above is to be quantified and collected from the defaulting bank by the ZAOs. The rate of interest to be charged is Bank Rate as prevailing (which is generally notified biannually on May 1 and November 1) plus 2% or as decided by Reserve Bank in consultation with CGA from time to time.

9. Accounting of "March" transactions

9.1 Reserve Bank, Central Office, Mumbai will issue in the month of February each year special instructions to all banks collecting direct taxes regarding the procedure to be adopted in accounting the March transactions.

9.2 The Nodal banks will be receiving scrolls relating to March of the previous Financial Year in April of the current year. In order to account for the entire collections of March in the same financial year the Nodal banks have to follow the following procedure during the month of April:

The nodal banks have to prepare two sets of separate scrolls - one pertaining to March residual collections (payments realized from taxpayer's account before 31st March) and another for April transactions during the first 15 days in April. They should ensure that all the tax collections made by the receiving branches upto 31st March are accounted as "March Residual Transactions" and should not be mixed up with the transactions of April which fall in the financial year. The main scrolls for March transactions prepared from 1st to 15th April are to be distinctly marked as "March Residual".

9.3 It may also be noted that all the cheques / amount realized on or before 31st March should be treated as transactions relating to the current financial year and should be accounted for as such under the head "March or March Residual Transactions" in the current financial year.

9.4 While reporting to their Link Cell in Nagpur, the Nodal banks should send two sets of figures distinctly showing March Residual and April Transactions separately upto 15th April.

9.5 The date-wise monthly statements should also be prepared in two sets, one pertaining to March Residual Transactions and another relating to April Transactions.

10. Special arrangements during the month of March every year

10.1 The branches should follow the procedure explained in the earlier paragraphs meticulously and ensure that the collections made towards direct taxes are passed on promptly for credit to Government Account through the Nodal Branch / Link Cell. However, during the second fortnight of March every year, wherever the receiving branches and Nodal branch are situated locally, a special messenger system should be introduced by the receiving branches. All efforts may also be made to provide the collection figures on daily basis to the ZAO during the second fortnight of June, September and December every year, for onward transmission to the Government for monitoring, estimates etc.

11. Monitoring Committee - holding of periodical meetings

11.1 For the smooth functioning of the revised scheme for collection and accounting of direct taxes by the Authorised Banks, the Monitoring Committees consisting of officials from Nodal Banks/local authorities of the banks, ZAO and I.T. Department will be formed at every Zonal Accounts Office centre. The Committee will meet half-yearly and discuss various issues connected with direct tax work such as accounting, scrolling, reporting, remittance and reconciliation etc. and make efforts to sort out the problems at its own level. Further, annually there will be a special Monitoring Committee meeting in which very senior officials from CBDT, RBI, I.T. Department and banks will participate and redress the various problems being faced by the banks, ZAOs and I.T. Department in the fields. Banks will ensure that the necessary follow-up actions are taken on the Minutes of such meetings.

12. Redressal of public grievances

12.1 Each Authorised Bank should have an effective procedure for dealing with public complaints at the branches rendering service to Government Departments or members of the public as prescribed, from time to time. In case the bank detects a mistake in reporting of a tax payment or the major head of tax payment, either suo moto or being brought to its notice by the tax payer, the bank will promptly transmit the error record (as described earlier at paras 2.6 and 7.4) to TIN. This is imperative as the Income Tax Department will give credit to a taxpayer's on the information transmitted by the bank to TIN.

Annex II

OLTAS

User Manual for File Segregation Utility (FSU)

Introduction

The FSU will be used by banks to generate a valid file from invalid input file and corresponding error file. This user manual will enable the bank users to better understand the functionalities provided in this File Segregation Utility.

Intended Users:

This manual is intended for the Link Cells of banks participating in OLTAS.

Conventions used

Detailed information about each field or button is available in the Field Description table following every task.

1. Overview

FSU in a utility which helps in generating a valid OLTAS file by removing the erroneous records. If you have an OLTAS file and the error file corresponding to it, this utility will help you to get rid of the erroneous records and make a new correct file. It removes the rejected records by reading the error file and generates a new file consisting valid records only with auto-generated RT04 records. This correct file can be uploaded to OLTAS site. All the rejected records are separated and kept in other file for your reference.

2. Functionality

When you open the SPECIAL_FVU.exe file a utility will be seen as below.

 

 

Figure 1

The utility contains name of utility at the top, buttons for minimizing and closing the utility, four text fields and four buttons named "Browse", a start button and a cancel button. A copyright message and version number will also be visible.

The user is required to enter valid inputs in all the four text fields described below.

A. Input Base File:

Give the full file path of the base file. This base file is the file which has got rejected due to some errors. You can select the file by clicking on browse button. It will show you an 'open' box as displayed below (Figure 2). Browse to the required folder, select the file and then click open.

Input file name should be in "ddmmyyfv.bnk" format only.

 

Figure 2

File extension should contain valid bank code.

B. Input Error File:

This is the error for the Input base file. (The one selected in step 1) The error file can be downloaded and saved from OLTAS site. You can also use the error file generated by OLTAS link cell utility. You need to give the full path of the error file. The browse button on the right hand side can be used as explained above. The error file contains the file name for which errors are found. This name should match with input base file. User should not change this file. Also if the correct error file is not used, following message will be shown and utility will get stopped (Figure 3).

There is no validation for name of the input error file.

 

Figure 3

Note : Output valid file will not get generated correctly if any one out of two input files has got tampered. Also Error file generated from FVU or obtained from OLTAS site is acceptable. NO OTHER formats should be used, as they may give wrong results.

C. Output base file:

This is the output valid file which can be uploaded to OLTAS site or validated through FVU. Full path of the file needs to be specified. The filename can be same as input base file name if the location is different else it will get overwritten to the input base file. Use browse button for browsing to required folder and then enter the required filename. The extension of the input base file and output base file should match.

a. Field MAJ_HD_CD, TOT_NO_OF_RFND, TOT_NO_OF_CHLN, TOT_NO_ERR_RFND, TOT_NO_ERR_CHLN, RFND_TOT_AMT, CHLN_TOT_AMT in RT04 are calculated from the records data present in output valid file.

b. No_Of_Nodal field will be calculated from the records data present in Output Valid File i.e. distinct ZAO Codes present in Output Valid File.

c. Transmission date for every RT04 will be same as ddmmyy part of the Output Valid File Name.

d. Field RFND_DEBIT_DT of RT04 is kept BLANK.

e. In a particular RT08 R / N combination, if there is error in any of the records, both the records will be rejected and put into the Output Error File.

The output base file name should be in format "ddmmyyfv.bnk"

D. Output error file :

The utility will put all the rejected records in this file. User need to give the full path for this file. There is no validation for the name of this file.

Start Button:

After entering valid filenames in all the four fields as above, click start button. A message will be shown after successful completion of the process.

Cancel Button:

Use Cancel button to close the utility.

Annex III

Format for Nodal Branch Daily Main Scroll (Receipts)

1

NODAL BRANCH SCROLL DATE (DD/MM/YYYY)

 

 

2

BSR CODE

 

 

3

DATE OF RECEIVING BRANCH SCROLL (DD/MM/YYYY)

 

First six fields

4

TOTAL TAX AMOUNT

 

 

5

TOTAL NO. OF CHALLANS

 

 

6

DO-ID

 

 

 

#

MAJOR HEAD

 

 

#

AMOUNT

 

Block

#

NO. OF CHALLANS

 

 

 

#

MAJOR HEAD

 

 

#

AMOUNT

 

Block

#

NO. OF CHALLANS

 

 

 

#

MAJOR HEAD

 

 

#

AMOUNT

 

 

#

NO. OF CHALLANS

 

 

 

 

This block (shown above) will be repeated for as many times as no of tax heads are available.

NOTE:

1) The record for one receiving branch should be contained in one line and values must be comma separated.

2) Carriage return or linefeed [i.e. ENTER KEY (↵)] indicates the end of the record for one receiving branch.

3) Sequence of block (majhd, amt, no_challan) is not necessary but increasing order is preferable.

4) Example:

First six fields block block block

30/11/2005, 0230001, 25/11/2005, 6600, 22, PNE, 0020, 200, 2, 0021, 100, 1, 0024, 300, 4, 0026, 400, 2, 0031, 500, 1, 0032, 600, 2, 0033, 700, 1, 0034, 800, 1,

0070, 900, 1, 0036, 1100, 5

 

First six fields

 

Block

 

Block

32

Detailed example

First six fields    block    block    block

13/11/2005, 0000455, 12/11/2005, 5775, 18, PNE, 0020, 1525, 6, 0021, 200, 2, 0023, 100, 1, 0026, 300, 2, 0031, 600, 1,0032, 750, 2, 0033, 550, 1, 0034, 800, 2, 0070, 950, 1

13/11/2005, 0003861, 12/11/2005, 9950, 17, PNE, 0020, 3500, 5, 0020, 2250, 3, 0023, 300, 1, 0026, 400, 1, 0031, 500, 1,0033, 600, 2, 0032, 700, 1, 0034, 800, 2, 0070, 900, 1  

13/11/2005, 0004618, 11/11/2005, 640112, 22, PNE, 0020, 629367,20, 0021, 10745, 2  

13/11/2005, 0230011, 11/11/2005, 47071, 2, PNE, 0020, 47071, 2  

13/11/2005, 0230116, 10/11/2005, 304648, 20, NSK, 0020,26942, 2,0021, 277706, 18  

13/11/2005, 0230004, 13/11/2005, 408134, 16, NSK, 0020, 407190, 15, 0021, 944, 1  

5) If nodal bank is sending the scrolls of two different dates for the same receiving branch in one DRS then their entry should be two different lines in the DRS file as shown below:

14/11/2005, 0002053, 12/11/2005, 5775, 18, PNE, 0020, 1525, 6, 0021, 200, 2, 0023, 100, 1, 0026, 300, 2, 0031, 600, 1,0032, 750, 2, 0033, 550, 1, 0034, 800, 2, 0070, 950, 1  

14/11/2005, 0002053, 13/11/2005, 9950, 17, PNE, 0020, 5250, 6, 0023, 500, 2, 0024, 300, 1, 0025, 400, 1, 0031, 500, 1, 0033, 600, 2, 0033, 700, 1, 0034, 800, 2, 0070, 900, 1  

14/11/2005, 0002034, 13/11/2005, 408134, 16, NSK, 0020, 407190, 15, 0021, 944, 1  

·        Observe first two lines of above DRS in which both lines contain same nodal branch scroll date and BSR code, which is a must in this case, but different details.

·        Date of receiving branch scroll is different which must be lesser then nodal branch scroll date.

·        Third line is regular row for other branch of the same nodal bank.

 

6) DATE: is date in DD/MM/YYYY format.

BSR CODE: is 7-digit numeric code.

DO-ID: is 3-digit alpha code.

MAJOR HEAD: is 4-digit numeric code.

AMOUNT and NO OF CHALLAN are numeric values.

Annexure-A-IV-I

Draft proforma of computer generated receipts to be issued by banks to taxpayers

 

Computer generated receipt

(to be issued by collecting bank branch to depositor of direct tax for deposit of Tax

Deducted at Source in Government account against challan form No.281)

Name of the bank collecting tax

 

Full name of deductor

 

TAN of deductor ( 10 characters )

 

Amount deposited :

 

(i) Income Tax

 

(ii) Surcharge

 

(iii) Education Cess

 

(iv) Penalty

 

Total amount deposited : (in figure )

 

Mode of deposit of tax (by cash / debit to account/ by cheque bearing No.)

 

Date of encashment of cheque (dd/mm/yy)

 

On account of Income Tax Deducted / Collected from companies (0020)/ Other than Companies (0021)

 

Minor head –Type of payment-(TDS/TCS deducted/collected by deductor OR demanded by department)

200/400

Nature of payment from which tax has been deducted or collected –(Give Section code)

Assessment Year (yyyy-yy)

 

Challan Identification number (CIN)

BSR code of collecting bank branch ( 7 characters )

 

Date of tender of cheque ( dd /mm /yyyy) ( 8 characters )

 

Challan Serial Number ( 5 characters )

 

Signature & seal of authorized signatory of collecting bank branch

 

Annexure-A-IV-II

Draft proforma of computer generated receipts to be issued by banks to taxpayers

Computer generated receipt

(to be issued by collecting bank branch to depositor of direct tax for deposit of Tax

Deducted at Source in Government account against challan form No.280)

Name of the bank collecting tax

 

Full name of taxpayer

 

PAN of taxpayer ( 10 characters )

 

Amount deposited :

 

(i) Income Tax

 

(ii) Surcharge

 

(iii) Education Cess

 

(iv) Penalty

 

Total amount deposited : (in figure )

 

Mode of deposit of tax (by cash / debit to account/ by cheque bearing No.)

 

Date of encashment of cheque (dd/mm/yy)

 

On account of Income Tax Deducted / Collected from companies (0020)/ Other than Companies (0021)

 

Minor head –Type of payment

 

Assessment Year (yyyy-yy)

 

Challan Identification number (CIN)

BSR code of collecting bank branch ( 7 characters )

 

Date of tender of cheque ( dd /mm /yyyy) ( 8 characters )

 

Challan Serial Number ( 5 characters )

 

Signature & seal of authorized signatory of collecting bank branch

 

 


 

Annex IV

How do I make online tax payment sitting at home/office?

Open a net-banking account with any of the banks listed above.

            i. Go to website incometaxindia.gov.in, click on 'pay taxes on-line'.

            ii. Fill in the required challan online. Help is available on screen as FAQ, downloads etc.

            iii. Make tax payment through net-banking account online.

            iv. A challan counterfoil will be available instantaneously on the screen with CIN (Challan Identification Number). The Challan Identification Number (CIN) on this counterfoil should be quoted in Return of Income.

            v. Print the counterfoil and also save it in the computer if possible.

            vi. Check if your payment has reached the Income Tax Department at https://tin.tin.nsdl.com/oltas/servlet/QueryTaxpayer.

 

**************

What are the advantages of paying taxes online

            i. You can pay taxes from any location at any time through your net-banking account

            ii. Instant transfer of funds from your account.

            iii. What you write on the e-challan will be directly sent to Income Tax Department.

 

Banks will not do any data entry.

            iv. You can save/print the challan copy and the receipt copy.

            v. As soon as your Bnak authorizes payment of the amount, you will receive a clear, legible receipt/counterfoil from your bank.

            vi. Transaction id of the e-payment transaction will be available to you in your bank statement.

            vii. You can check online if your money has actually reached the I-T department. For this you have to go to Tax information Network website:

 

https://tin.tin.nsdl.com/oltas/index.html

and click the box

CIN Based View

 

For detailed information please go to: incometaxindia.gov.in PAY TAXES ONLINE

IMP: In case of refunds adjusted against arrear demand, the normal refund should be attached with challan and sent to Bank by AOs as per earlier procedure.

 

Master Circular — Index

Sr.No.

Reference No

Subject

1.

DGBA.GAD.No.H-684/42.01.001/2003-04 dated January 9, 2004.

Amendments to Pink Book 'Accounting System for Direct Taxes'.

2

RBI 2004/135

DGBA. GAD.No.1142 /42.01.001/2003-04 dated April 2, 2004

Procedure for Collection of Taxes at Bank Branches - Customer Service

3

RBI/2004/131 DGBA.GAD.No.1008/42.01.034/2003-04 dated April 1, 2004

Introduction of On-line Tax Accounting System (OLTAS) - Branding of Rubber Stamp on copies of Challans

4

RBI/145/2004

DGBA.GAD.No.H-1068 /42.01.034/2003-04 dated April 16, 2004

Accounting Procedure for On-line Tax Accounting System (OLTAS)

5

RBI/2004/184

DGBA.GAD.No.H-1114/42.01.034/ 2003-04 dated April 29, 2004

Implementation of On-line Tax Accounting System with effect from June 1, 2004

6

RBI/2004/75

DGBA.GAD.No.H-69/42.01.034/2004-05 dated July 28, 2004

On-line Tax Accounting System (OLTAS) - Transmission of data to NSDL - Validation Checks

7

RBI/2004/326

DGBA.GAD.No.3278-3311/42.01.034/ 2004-05 dated December 31, 2004

Abolition of Sub-Agency Arrangements for Collection of CBDT Dues – OLTAS

8

RBI/2005/406

DGBA.GAD.5236/42.01.034/2004-05 dated March 29, 2005

On-line Tax Accounting System (OLTAS)-Funds Settlement - Reporting to RBI, CAS Nagpur

9

RBI/2005/466

DGBA.GAD.No.H.5801/42.01.034/2004-05 dated May 13, 2005

On-line Tax Accounting System (OLTAS) – Funds Settlement

10

RBI/2004/213

DGBA.GAD.No.H- 1169 / 42.01.034 / 2003-04 dated May 22, 2004

Accounting Procedure Relating to On-Line Tax Accounting System (OLTAS) - Clarifications

11

RBI/2004/181

DGBA.GAD.No.H-235/42.01.034/2004-05 dated September 15, 2004

On-line Tax Accounting System (OLTAS) - Participation of Branches

12

RBI/2004/164

DGBA.GAD.No.H-170/42.01.034/2003-04 dated September 4, 2004

Critical Issues regarding data capture of OLTAS data by banks


13

RBI/2005/411

DGBA.GAD.No.H-5287/42.01.034/2004-05 dated April 1, 2005

On-line Tax Accounting System (OLTAS) - Accounting Procedure relating to crediting of CBDT collections to Government accounts.

14

RBI 2005/412

DGBA.GAD.No.H5318 /42.01.034/ 2004-05 dated April 4, 2005

De-authorisation of bank branches

for collection of Direct Taxes

15

RBI/2005/81

DGBA.GAD.No.382/42.01.034/2005-06 dated July 26, 2005

OLTAS - File Segregation Utility developed by Tax Information Network (TIN)

16

RBI/2005/39

DGBA.GAD.No.H-42/42.01.034/2005-06 dated July 4, 2005

Finance Act 2005- Changes in Major

Head and Challans - OLTAS

17

RBI/2005/43

DGBA.GAD.No.H-76/42.01.001/2005-06 dated July 5, 2005

Levy of Banking Cash Transaction Tax on the Cash withdrawal by the Government Departments

18

RBI/2005/85

DGBA.GAD.No. H- 414/42.01.001/ 2005-06 dated July 30, 2005

Obligation of Schedule Banks to furnish information on Banking Cash Transaction Tax (BCTT).

19

RBI/2004/300

DGBA.GAD.NO.H.2532-65/42.01.034/ 2004-05 dated December 14, 2004

Compulsory Quoting of Permanent Account Number (PAN) / Tax Deduction Account Number (TAN) on Challans from 1/1/2005

20

DGBA.GAD.No.H-8649/42.01.034/2005-06 dated December 23, 2005

OLTAS-Software validations at banks

21

RBI/2006/295

DGBA.GAD.No.H.11140/42.01.034/2005-06 dated February 2, 2006

Online Tax Accounting System (OLTAS) - Sending daily scrolls by e-mail to ZAOs

22

DGBA.GAD.No.H-8294/42.01.037/2005-06 dated December 14, 2005

Online Tax Accounting System –

Drawing of Cheques by Assessees- Payee's Name

23

RBI/2006/55

DGBA.GAD.No.H-161/42.01.034/2005-06 dated July 7, 2006

OLTAS - Verification of PAN/TAN

24

RBI/2005/265

DGBA.GAD.No.H-8824/42.01.034/2005-06 dated December 28, 2005

Compulsory quoting of Permanent Account Number (PAN) / Tax Deduction Account Number (TAN)- State of Rajasthan

25

RBI/2006/150

DGBA.GAD.No.H-6226/42.01.011/2006-07 dated October 10, 2006

Permissible period of remittance of Government Revenues.


26

RBI/2007/235

DGBA.GAD.No.H-11763/42.01.011 /2006-07 dated January 24, 2007

Delay in Remittance of Government Receipts - Delayed Period Interest

27

RBI/2007/286

DGBA.GAD.No.13742/42.01.011/2006-07 dated March 13, 2007

Delay in Remittance of Government Receipts-Delayed Period Interest

28

DGBA.GAD.No.3774/42.01.034/2007-08 dated October 9, 2007

Discrepancies in Challan Details uploaded to TIN

29

RBI/2008/275

DGBA.GAD.No.10577/42.01.038/2007-08 dated April 3, 2008

Cut-off time for e-payment transactions pertaining to Government Revenue

30

RBI/2008/280

DGBA.GAD.No.H-10875 / 42.01.038/ 2007-08 dated April 10, 2008

Mandatory e-payment of tax by certain categories of taxpayers w.e.f. 01.04.2008

31

RBI/2008/321

DGBA.GAD.No.H-11895/42.01.038/ 2007-08 dated May 15,2008

Mandatory e-payment of direct taxes by corporate and assesses coming under Sec.44AB of IT Act

32

RBI/2008/328

DGBA.GAD.No.H-12070/42.01.034/ 2007-08 dated May 22, 2008

Improvement in data quality- Introduction of Computerised receipts w.e.f. June 1, 2008

33

DGBA.GAD.No.H.551/42.01.011/2008-09 dated July 18, 2008

Permissible Period of Remittance of E-payment of Government Transactions – Private Sector Banks

34

RBI/2008/09/97

DGBA.GAD.No.H. 549/42.01.011/2008-09 dated July 18, 2008

Permissible Period of Remittance of e-payment of Government Transactions – Public Sector Banks

35

RBI/2009/463

DGBA.GAD No.H-9284/42.01.011/2008-09 dated April 28, 2009

Recovery of Interest from Public Sector Banks on delayed remittances

of Government Receipts into Government Account

 

Master Circular - Collection of Direct Taxes - OLTAS

 

Circular No. DGBA.GAD.No. H-2/42.01.034/2009-10, dated 1-7-2009

 

Please refer to our master circular RBI/2008-09/81 dated July 01, 2008 on the above subject which was issued with a view to facilitate quick reference to all the extant instructions issued on the subject at one place. We have now updated the master circular incorporating important instructions issued by us till end June, 2009. A copy of the same is enclosed for your information. This circular may also be downloaded from our website www.mastercirculars.rbi.org.in

 

Enclosure

Master Circular on Collection of Direct Taxes

Introduction

The Central Board of Direct Taxes (CBDT) is responsible for administering various direct taxes through the Commissioners of Income-tax located in different parts of the country. The Commissioners of Income-tax are entrusted with the task of collection as well as refund of Income-tax and Corporation Tax, etc. under the Income-tax Act, 1961.

2. The Principal Chief Controller of Accounts (Pr.CCA) is the apex authority of the accounting organisation of the Central Board of Direct Taxes. Under the Departmentalised set up, the Pr.CCA, CBDT has been assigned the functions relating to accounting of all receipts and refunds pertaining to the Direct Taxes. The Pr.CCA sits at New Delhi and operates through Zonal Accounts Offices (ZAOs) across the country. Presently there are 24 ZAOs located at various places.

3. Major Heads of Account

The various types of direct taxes collected by the Income Tax Department are classified under the following Major Heads:

i) Corporation Tax (C.T.)

0020 Corporation Tax

ii) Income Tax (I.T.)

0021 Taxes on Income other than Corporation Tax

iii) Wealth Tax (W.T.)

0032 Taxes on Wealth

iv) Gift Tax (G.T.)

0033 Gift Tax

v) Fringe Benefit Tax

0026

vi) Banking Cash Transaction Tax

0036

 

4. Prior to 1st April 1976, Income and other Direct taxes were accepted by the Offices of Reserve Bank of India (RBI), the branches of State Bank of India (SBI), its associates conducting Government business, treasuries and sub-treasuries. With a view to increasing the number of points at which these taxes could be deposited conveniently by the members of the public, a scheme for collection of income tax and other direct taxes through the branches of public sector banks was introduced with effect from 1st April 1976.

5. 'Accounting System for Direct Taxes' - Revised procedure

(RBI Circular DGBA.GAD.No.H-684/42.01.001/2003-04 dated January 9, 2004)

After studying the issues relating to Accounting and reporting, delays in remittance and in dispatch of documents etc., the 'Working Group on Government Accounts' suggested the revised procedure which came into effect from 1st October 1988. Reserve Bank has issued comprehensive instructions on acceptance of CBDT dues and its accounting and reporting vide its publication 'Accounting System for Direct Taxes' which came to be known as the Pink Booklet.

6. With a view to improving customer service to direct taxpayers, special attention was drawn to the following provisions of 'Accounting System for Direct Taxes' :

(RBI/2004/135 (DGBA.GAD.No.1142 /42.01.001/2003-04) dated April 2, 2004)

(i) Issue of Token : While instructions issued by Reserve Bank regarding the issue of paper token as an acknowledgement of payments are very clear, it is observed that a large number of authorised branches do not issue such tokens. In many places, there are informal arrangements wherein the taxpayer is asked to collect the challan after a specific date from the bank branches. In some cases, the receipted challans are not kept securely and are placed in an open box. The customers are allowed to freely pick up their challans without any identification. In the case of challans deposited with cheque or draft, the receipted challans will be issued on realisation of the amount of cheque or draft and hence the paper token should indicate the date on which the receipted copies of the challans would be kept ready so that the assessee makes an arrangement to collect the receipted challan on the date given in the token.

(ii) Receipted Challan: The receipted challan should be made available to the assessee within 4-5 days, based on the local Clearing arrangements. The branches should ensure that this stipulated waiting period must not be exceeded and any deviation in this regard will be viewed seriously by Reserve Bank. The receipted challans should be handled with care and in a secured manner till they are handed over to the assessee across the counter on presentation of the relevant paper token. Under no circumstance, the receipted challan should be kept in open box accessible to customers.

(iii) Double Date Stamp on Receipted Challan: It is reiterated that the challan should bear two dates i.e. the 'Date of tender' of challans and instruments and the 'Date of realisation' of proceeds of the instruments as specified in Annexure-V of the Pink Booklet.

(iv) Acceptance of Clearing Cheques: It is observed that some of the banks are reluctant to accept cheques drawn on other banks while receiving taxes resulting in practice of Chartered Accountants/Tax Consultants tendering their own cheques on behalf of their clients. As accepting cheques drawn on other banks will greatly facilitate the customers, banks are advised not to turn back customers who tender challans with cheques drawn on other banks.

(v) Do's and Don'ts : A list of Do's and Don'ts as given in the Annexure-IV of the Pink Booklet were not being supplied to the bank staff dealing with the Direct Tax collection work as required. The same may be issued to the branches.

7. Online Tax Accounting System (OLTAS)

(RBI/2004/131 (DGBA.GAD.No.1008/42.01.034/2003-04) dated April 1, 2004, RBI/2004/145 (DGBA.GAD.No. H-1068 /42.01.034/2003-04) dated April 16, 2004 & RBI/2004/184 (DGBA.GAD.No.H-1114/42.01.034/2003-04) dated April 29, 2004)

7.1 A High Powered Committee (HPC) was constituted by Reserve Bank for setting up OLTAS in January 2003. The HPC set up a Sub-Committee to suggest the Accounting Procedure for Online Tax Accounting System. The Accounting procedure duly approved by CGA and CAG was introduced for OLTAS w.e.f June 01, 2004.The new accounting procedure (Annexure) was forwarded to all agency banks on April 16, 2004. The salient features of the new accounting procedure are the introduction of a single copy challan with tear-off taxpayer's counterfoil, branding of acknowledgement stamp with unique serial number known as Challan Identification Number (CIN) on the single copy challan and on taxpayer's counterfoil. Tax payers are now able to view the tax paid by them by logging on to http://tin-nsdl.com. Further, the new file structure required by Income Tax Department was also forwarded to Agency banks for developing suitable software for the OLTAS.

7.2 Under the new procedure banks were advised to issue acknowledgement in respect of challans tendered with clearing cheques/drafts (i.e. other than cash and transfer cheques/drafts) only after the realization of such cheques/ drafts. Banks were further advised to issue paper token in respect of such challans indicating the date of tender and the date on which the counterfoil will be kept for delivery. The receiving banker was advised to return the tear-off portion of taxpayers' counterfoil on realization of such cheques/ drafts after branding with the rubber stamp acknowledging the payment with Challan Identification Number (CIN) comprising of the following:

            i. BSR Code number of the bank branch (7 digits)

            ii. Date of presentation of the challan (DD/MM/YY)

            iii. Serial number of the challan in that branch on that day (5 digits).

 

7.3 The tear off portion of the challans accompanied with cash or cheques drawn on the same receiving branch may be returned to the taxpayer on the same day with necessary acknowledgement by branding with the rubber stamp prescribed above.

7.4 All the non-computerised/ non- networked branches were advised to ensure that data pertaining to those branches be transmitted from its nearest computerized/networked branch to the Nodal branch and from Nodal branch to Link Cell electronically so that complete data pertaining to all the authorized branches of a bank throughout India are seamlessly transmitted to the Tax Information Network (TIN) hosted by NSDL.

7.5 It was further advised that the new accounting procedure under OLTAS will replace the existing procedure in so far as the sending of scrolls and challans to the Income Tax Department is concerned. It was also advised that except for the changes proposed in the OLTAS Accounting Procedure forwarded to banks, the instructions contained in the Pink booklet "Accounting System for Direct Taxes" (Updated upto June 30, 1999) will continue to be in force.

7.6 Further, need for transmitting data online to TIN in addition to the normal practice of sending paper scrolls and challans to the ZAO and Income Tax department was also emphasised.

7.7 It was suggested to banks that their Link Cells at Nagpur may be connected to TIN (NSDL) at Mumbai with a dedicated leased line to ensure secure two way communication.

8. Transmission of data to NSDL - Validation Checks

(RBI/2004/75 (DGBA.GAD.No. H-69 /42.01.034/2004-05) dated July 28, 2004,

DGBA.GAD.No.H-8649/42.01.034/2005-06 dated December 23, 2005)


 

8.1 Various types of errors noticed by National Securities Depository Ltd. (NSDL)/Income Tax Department in the data uploaded by banks have been advised to the banks. In particular, data entry errors noticed in respect of PAN/TAN Number, incorrect nodal scroll branch data, assessment year, absence or incorrect tax-payer's name, CIN Numbers, major head codes and amounts were brought to the notice of banks.

8.2 To counter the lacunae observed, it has been decided that each bank will incorporate the following validation checks with immediate effect in the OLTAS software for all Record Types:

                      (i) Value for the field NOD_BR_COL_SC_DT and NOD_BR_PYMT_SC_DT in RT01 and RT06 respectively should be between 01-06-04 and date of transmission (i.e. filename).

                      (ii) PAN/TAN cannot be of lesser than 10 alphanumeric characters. If its length is 10 then in case of PAN first five and tenth character of PAN should be alpha only, and sixth to ninth i.e. next four should be numeric. In case of TAN first three characters should be CTU code and fourth, tenth must be alpha and next five (fifth to ninth) should be numeric. Quoting of PAN/TAN is made compulsory w.e.f January 1, 2005.

                      (iii) Name field is always mandatory and it should have a combination of alphanumeric and dots only and it should be of more than one character (the name string should not be of dots and numeric or both. Alphabets must be there in main string). It is mandatory to transmit the full name of tax payer irrespective of the fact that PAN/TAN has been mentioned on the challan.

(iv) ZAO code number of a collecting branch is permanent and details of ZAO code numbers are available in the pink booklet published by the Reserve Bank. Nodal Branches must ensure that this ZAO code number is correctly mentioned in Record Type 01 and is not altered under any circumstances. It is advised that all the banks should save the code in the ZAO field in their OLTAS software as instances have been brought to the notice of RBI/Government where the same branch is mentioning different ZAO code on different dates of transmission.

8.3 In addition to the above validation checks, the following supervisory steps have to be taken by banks:

(i) Branch Managers of the collecting branches must ensure correctness of the name and amount captured from the challans. For this 'maker-checker' system of data entry must be adopted in all the bank branches.

(ii) All collecting branches must compulsorily transmit Record Type 01 and Record Type 02 (Summary Record), if there is collection on that day. In branches where there has been no collection during the day, Record Type 02 (NIL statement) is to be transmitted to the Nodal Branch. This would enable the TIN to accurately monitor the implementation of OLTAS.

                        (iii) At the Nodal Branch level supervision has to be made to ensure that all the collecting branches are transmitting the Record Type 01 and Record Type 02. They should also ensure that those collecting branches that have no collection transmit only Record Type 02 (NIL Statement) with MAJ_HD_CD=0 and TOT_AMT=0 to their respective Nodal Branch.

                        (iv) Branch Manager of Nodal Branch must ensure that the Major Head wise collection shown in the Nodal Branch Scroll of a particular date submitted to the ZAO, tallies with the corresponding totals in the OLTAS data transmitted to the Link Cell for submission to TIN. This exercise should be done in respect of all payments from June 1, 2004.

(v) All the banks at Link Cell level should maintain an error record of action taken on error records transmitted to TIN. This would ensure that all records which had initially been rejected by TIN due to some deficiencies are compulsorily retransmitted to TIN after removal of lacunae within 48 hours.

(vi) It is observed that the banks are entering wrong major head codes i.e. interchanging payments received under Major Head 020 for Corporation Tax or Major Head 021 for Income tax other than Corporation Tax. This leads to avoidable misclassification of payments and affects the reconciliation of accounts between the Income Tax Department and ZAO. In case of a valid PAN, the above validation can be implemented in the OLTAS software i.e. if 4th character (from the left) is 'C' then Major Head code must be 020.

8.4 Income Tax Department has also informed us that while transmitting assessment year data, banks were required to transmit the first part for normal as well as block assessment years; for example for the normal assessment year 2005-2006 the bank is required to transmit 2005 and for a block assessment year like 1997-2005, the year 1997 should be transmitted.

9. Sending daily scrolls by e-mail to ZAOs

(RBI/2006/295(DGBA.GAD.No.H-11140/42.01.034/2005-06 dated February 2, 2006)

Banks were advised of the revised format of electronic Nodal Branch Daily Main Scroll for Direct Tax Collection. The revised format (Annex III) is to be used to send the Daily Main Scroll electronically to all ZAOs pending receipt of physical challans/scrolls from all receiving branches.

10. Abolition of Sub-Agency Arrangements for Collection of CBDT Dues

(RBI/2004/326(DGBA.GAD.No.3278-3311/42.01.034/2004-05) dated Dec. 31, 2004)

It was observed that one of the major reasons for non-uploading of data under OLTAS is the existence of Sub-Agency arrangements with another prominent bank in the locality where the Sub-Agency bank concerned does not have sufficient number of branches for having its own Nodal Branch as per the norm then prescribed by CBDT. Due to non-compatibility or for other reasons, the data in respect of challans received by collecting branches under sub agency arrangements were not uploaded to TIN by the Principal Agency banks in many cases. With a view to avoiding delay and problems arising out of the sub-agency arrangements, it has been decided in consultation with Directorate of Income Tax (Systems), New Delhi to discontinue the Sub-Agency arrangement altogether. Banks were advised to designate their own Nodal branches wherever their branches were functioning under sub-agency arrangements.


 

11. Funds Settlement - Reporting to RBI, CAS Nagpur

(RBI/2005/466 (DGBA.GAD.No.H. 5801 /42.01.034/ 2004-05) dated May 13, 2005 & RBI/2005/406 (DGBA.GAD.H 5236/42.01.034/2004-2005) dated March 29, 2005)

11.1 Keeping in view the decision to switch over to settlement of funds on the basis of on-line data uploaded to TIN with effect from April 1, 2005, the existing system of reporting CBDT transactions to RBI, CAS, Nagpur has been reviewed. Accordingly, it was decided that agency banks will submit the CBDT figures to RBI, CAS, Nagpur separately through digitally signed e-mail (to be signed by a class II certificate holder). The CBDT figures reported to TIN as at 13.15 hours on week days and 12.30 p.m. on Saturdays would simultaneously be reported to CAS, Nagpur for funds settlement through digitally signed e-mail. The data mailed after the cut-off time would not be accepted by CAS, Nagpur under any circumstances.

11.2 Banks were advised that any rejections by the system at RBI, CAS will not be accounted for on the same day as it is presently being done after obtaining corrected revised advices from the Link Cells. The figures accepted by the system at CAS would be accounted for. The rejection report would be passed on to the Link Cell along with the daily input statement on the same day. Banks were advised to issue necessary instructions to their branches and the Link Cell in this regard.

11.3 It was clarified that the financial data file uploaded to CAS, Nagpur on any given date for funds settlement and the challan data relating to that particular settlement date uploaded to TIN should exactly match. Files rejected subsequently by NSDL, if any, due to validation errors etc. should be processed separately and re-uploaded. Banks were advised to ensure that challan data in respect of each and every challan deposited by the assessee is uploaded and duly accepted by TIN. Such re-uploading of files to TIN would not affect the funds settlement data. The requirement of complete reporting to TIN would be achieved if the data going from Link Cells to CAS, Nagpur and the relative challan data going to TIN are uploaded simultaneously.

11.4 Link Cells were advised to ensure that there is no mismatch in figures uploaded to CAS and TIN for a given uploading date.

11.5 Nodal Branches were advised to follow the instructions contained in paragraph 6 of the 'Accounting Procedure Relating to On-line Tax Accounting System (OLTAS)' meticulously and were advised to dispatch the Scrolls and Challans etc. on a day -to- day basis to Zonal Accounts Offices concerned.

12. Certain clarifications issued by the RBI for guidance to banks as regards OLTAS are reproduced below:

(RBI/213/2004(DGBA.GAD.NO.H-1169/42.01.034/2003-04) dated May 22, 2004 & RBI/2004/181 (DGBA.GAD.No. H-235/42.01.034/2004-05) dated September 15, 2004)

12.1 Challan Identification Number (CIN)

It was clarified that as per paragraph 1.3.3 of OLTAS Accounting Procedure (Annexure) running serial number would have to be given for all the challans tendered with cash, transfer cheques as well as clearing cheques on a particular day across all types of direct taxes. While the tear-off portion of the challan tendered with cash and transfer cheques (i.e. the cheque drawn on the collecting branch) needs to be returned to the tenderer with the prescribed rubber stamp indicating the date of tender, BSR code and CIN etc., the challans tendered with clearing cheques (i.e. drawn on other branches/banks) would have to be returned only on realisation of the instruments. The authorized official of the receiving bank branch was also required to sign the tear-off portion of the challan as well as original challan.

12.2 Banks were requested to visit Income Tax website (www.incometaxindia.gov.in) for Frequently Asked Questions (FAQs) on OLTAS.

13. Further, banks were advised to ensure full participation of authorized branches and ensure that every challan record is transmitted to TIN by every branch where tax collection has been made. It was reiterated that a NIL statement (Record type 02) may be transmitted to the nodal branch when there had been no tax collection during the day to enable TIN to monitor OLTAS properly. It was also emphasized that the data transmitted to TIN should be correct and complete and conforms to the stipulated procedures.

14. Banks were advised of the following critical short comings which were brought to the notice of RBI by Directorate of Income Tax:

(RBI/2004/164 (DGBA.GAD.No.H-170/42.01.034/2003-04) dated September 4, 2004)

14.1 Non capture of PAN/TAN by banks - It had been reported from many centres that even where the taxpayer has correctly quoted his PAN in full, certain bank branches were either not entering it or were entering it in an incomplete manner. In this connection, banks were advised that under the On-line Tax Accounting System (OLTAS) procedure/rules, it had been laid down that wherever the 10 digit PAN/TAN in the proper alpha numeric structure is quoted by the taxpayer the banks would only have to capture the PAN and the name of the taxpayer and not the address.

14.2 Non capture of the full name of the taxpayer - Perusal of the data uploaded to TIN indicated that many bank branches are still putting one or two characters in the name column of the taxpayer. In some cases even symbols and dots were used. Banks may please ensure capture of taxpayer's full name in OLTAS data.

14.3 Incorrect address field - The data analysed also reveals that the address field was not being captured properly by many bank branches. In many cases, just a few random alphabets or numbers were being entered which again indicated that the bank branches were not taking adequate care for full data capture. Banks were advised to take necessary corrective action.

14.4 Wrong reporting of Challan Identification Number (CIN) – It was observed that some bank branches were allotting a particular Challan Identification Number (CIN) on the taxpayer's counterfoil but entering a different CIN on the OLTAS data sent. As per OLTAS procedure/rules, CIN was to be allotted on date of presentation only. The CIN Number stamped on the taxpayer's counterfoil as well as on the main body of the challan should be transmitted to TIN.

14.5 Non uniform scroll data - As per the On-line Tax Accounting procedure rules, the scroll of a Nodal Branch for a particular day is to be identical for both the ZAO as well as for the data transmitted on OLTAS to TIN. It was, clarified that all collection data being sent to ZAO and TIN for a particular day must match both in respect of number of challans and Major Heads. Further banks were advised to ensure that each and every challan record is sent to TIN by every branch where collection has been made.

15. De-authorisation of bank branches for collection of Direct Taxes

(RBI/2005/412 (DGBA.GAD.No.H 5318 /42.01.034/ 2004-05) dated April 4, 2005)

15.1 With a view to streamlining the procedure for delisting of authorised bank branches under OLTAS, it has been decided in consultation with the office of Principal Chief Controller of Accounts (Pr CCA), CBDT, New Delhi that any proposal for deauthorisation of branches should be submitted by the Head Offices of the Agency banks to RBI, Central Office keeping in view the following parameters/ guidelines:

            i) The existing branch has not received any Direct Tax in the previous year (April-March)

            ii) The proposal for delisting of authorised branch has the approval of the Top Management of the concerned bank.

15.2 After the proposal is approved by RBI/Office of Pr.CCA, CBDT the concerned bank should give wide publicity to the effect that the specific branch will discontinue acceptance of taxes with effect from a specific prospective date and advise us accordingly.

16. File Segregation Utility developed by Tax Information Network

(RBI/2005/81(DGBA.GAD.No.382/42.01.034 /2005-2006) dated July 26, 2005)

Requests have been received from some banks that Tax Information Network (TIN) should not reject the entire file of OLTAS data received from a bank's Link Cell because of a few erroneous records. The banks have desired that TIN should accept the records which are with correct validations while rejecting the erroneous records. On the basis of the discussions CBDT had with NSDL (TIN) and banks, TIN had developed a File Segregation Utility which was advised to banks. (Annex II)

17. Accounting Procedure relating to crediting of CBDT collections to Govt. Account – Public Sector Agency Banks

(RBI/2005/411 (DGBA.GAD.No. H- 5287/42.01.034/2004-05) dated April 1, 2005, RBI/2006/150 (DGBA.GAD.No.H-6226/42.01.011/2006-07) dated October 10, 2006 and RBI/2007/235 (DGBA.GAD.No.H-11763 / 42.01.011 /2006-07) dated January 24, 2007, RBI/2007/286 (DGBA.GAD.No.13742 / 42.01.011 /2006-07) dated March 13, 2007)

17.1 It has been decided in consultation with Government of India to amend the instructions relating to the maximum number of days allowed for crediting tax collections to T+3 working days (where T is the day when money is available to the bank branch) instead of T+3 days (including Sunday and Holidays) with effect from April 1, 2005. For calculating working days holiday list of CAS, Nagpur will be reckoned.

17.2 It has been decided that the put through date, i.e. the date of settlement with the CAS, RBI shall be kept outside this existing time limit of T+3 working days.


17.3 Delayed period interest shall be imposed on banks for the delayed period and not from the date of transaction. In other words, the 'delay period' calculation will start from the day following the put through date.

17.4 The period of delay in a transaction of Rs.1 lakh and above shall attract delayed period Interest at Bank Rate + 2%. The Bank rate will be the rate as being notified by the RBI from time to time.

17.5 For the transaction below Rs.1 lakh each, the delayed period interest shall be levied at the Bank Rate for delays up to 5 calendar days and above 5 calendar days at the Bank Rate + 2 % for the full period of delay. The Bank Rate will be the rate notified by the RBI as applicable at the time of transaction.

17.6 It has also been decided by the Controller General of Accounts that every Principal Chief Controller of Accounts (Pr.CCAs), Chief Controller of Accounts (CCAs) and Controller of Accounts (CAs) in Ministries/Departments shall undertake Quarterly Review of all the remittances made by the banks. If the delay is found to be 5% and more with the bank as a whole or with any of its branches in two successive quarters, authorisation for the concerned bank or the branch will be forwarded to the CGA for review with the recommendations of Pr.CCA/CCA/CA. The banks are expected to build up their own internal control mechanism so that the preventive and corrective actions are taken by the bank for its branches well in time.

18. Accounting Procedure relating to crediting of CBDT collections to Govt. Account – Private Sector Agency Banks.

18.1 In the case of private sector agency banks the time limit for settling the transactions with CAS, Nagpur will continue to be T+3 days (including Sundays and Holidays). The period of delay will be counted from the date of receipt of the collection at the receiving branch (actual realisation of the money in the bank) till it is reported to Reserve Bank of India, CAS, Nagpur for credit to Government account. Delayed period interest will be recoverable from the banks regardless of the amount involved. Delayed period interest shall be levied at the prevailing Bank Rate+2%. (Bank Rate shall be notified by RBI from time to time).

18.2 Further, the instructions given at Para 17.6 above will also be applicable to private sector agency banks.

19. Drawing of Cheques by Assessees- Payees Name

(DGBA.GAD.No.H-8294/42.01.037/2005-06 dated December 14, 2005)

With a view to obtaining uniformity in the Payee's name while drawing cheque/DD by assessees for depositing challans for Direct Tax Payment under OLTAS, it has been decided by the Income Tax Department to print the following instructions on the reverse of the Income Tax Challan:

"Tax payer may please draw/issue cheque/DDs towards payment of Income Tax as under:

"Pay….. (Name of the Bank where the challan is being deposited)- A/c Income Tax".

Banks were advised to bring the change to the notice of all their authorised branches.

20. New Major Heads/Challans

(RBI/2005/39 (DGBA.GAD.No.H-42 /42.01.034/2005-06) dated July 4, 2005)

Banks were advised of the revised challan formats introduced by Government of India which were necessitated by the introductions of two new taxes i.e. Fringe Benefit Tax and Banking Cash Transactions Tax. Consequent changes/ rationalization made to Major Heads and Sub-Minor Head of Accounts by Income Tax Department are given below:

CHALLAN NO.ITNS – 280

The Challan is for the payment under the two Major Heads i.e. (a) 0020 Income-tax on Companies (Corporation Tax) and (b) 0021 Income-tax (other than Companies). It should now be possible for taxpayers to pay taxes for assessment years other than consecutive assessment years. For example, in the case of assessments for block period (more than one consecutive assessment year), the assessment year field in the bank's software may be modified to accept payments for a period other than consecutive assessment year for example payments for A.Y. 1991-97, 1992-99, 1993-99 etc.

CHALLAN No.281

The challan is meant for payment of TDS (tax deducted at source)/TCS (tax collected at source). It has two Major Heads i.e. (a) 0020 for company deductees and (b) 0021 for non-company deductees. The challan has two Minor Head Codes which are to be ticked by the tax payer (a) TDS/TCS payable by tax payer (Minor Head -200) (b) TDS/TCS on regular assessment (raised by Income-tax Department (Minor-Head - 400).

The new three digit codes Sub-Minor Heads now introduced in the challan are as under:

Section

Nature of Payment

Code

206C

Collection at source from Alcoholic Liquor for Human Consumption

6 C A

206C

Collection at source from Timber obtained under Forest lease

6 C B

206C

Collection at source from Timber obtained by any Mode other than a Forest Lease

6 C C

206C

Collection at source from any other Forest Produce (not being Tendu Leaves)

6 C D

206C

Collection at source from Scrap

6 C E

206C

Collection at source from contractors or licensee or lease relating to Parking lots

6 C F

206C

Collection at source from contractors or licensee or lease relating to Toll Plaza

6 C G

206C

Collection at source from contractors or licensee or lease relating to mine or quarry

6 C H

206C

Collection at source from Tendu leaves

6 C I

 

CHALLAN NO. 282

This challan is for the payment of a number of taxes. The changes introduced in this challan are as under:

            a) Securities Transaction Tax has been renumbered as Major Head 0034 in place of the earlier Major Head 0025.

            b) Wealth-Tax - Major Head 0032 has been included in this Challan. Earlier this Major Head was in Challan No.280.

 

CHALLAN NO.283

This is a new challan introduced. It is for the payment of (a) Banking Cash Transaction Tax - Major Head 0036 and (b) Fringe Benefit Tax - Major Head 0026. The valid Minor Head for both these categories of taxes are (i) Self Assessment Tax, Minor Head - 300 and (ii) Tax on Regular Assessment Tax - Minor Head 400 and (iii) Advance Tax, Minor Head-100.

Banks may please arrange necessary modification in OLTAS software and bring the above changes to the notice of all the branches collecting direct taxes to enable the branches to accept payment of these taxes with immediate effect.

21. Verification of PAN/TAN

(RBI/2006/55(DGBA.GAD.No.H-161/42.01.034/2005-06 dated July 7, 2006))

It has since been decided that the Income Tax Department through their Regional Computer Centre would provide a CD, containing the PAN/TAN master, and the name of tax payers of that region to the nodal branches of all agency banks which will be updated on a quarterly basis. Banks were advised to replicate the copies of the CD for internal distribution to their branches along with a simple data retrieval software which may be used for cross verifying the PAN/TAN quoted by the tax payer in the challan tendered. Banks were also advised to explore the possibility of developing a software whereby the PAN/TAN and the name provided in the CD gets captured by their data entry system automatically thereby eliminating separate data entry of PAN/TAN. If the tax payer's PAN/TAN is not available in the CD, the customer may be requested to produce a copy of the relevant PAN/TAN card or any other document to indicate the correctness of the PAN/TAN. Banks are not required to retain these documents used for the purpose of verification in cases where the PAN/TAN of the tax payer is not available in the CD supplied by Regional Computer Centre. Most importantly, banks were advised not to accept challans without a visual check by the receiving official concerned to ensure that the challan contains PAN/TAN in the valid 10 digit character.

22. Compulsory Quoting of Permanent Account Number (PAN)/Tax Deduction Account Number (TAN) on Challans from 1/1/2005

(RBI 2004/300 (DGBA.GAD.NO.H-2532-65/42.01.034/2004-05) dated December 14, 2004 &

RBI/2005/265(DGBA.GAD.NO.H-8824/42.01.034/2005-06 dated December 28, 2005)

With a view to ensuring correct and prompt credit to tax payers, Central Board of Direct Taxes (CBDT), Government of India have decided to implement the provisions for mandatory quoting of PAN/TAN on Challans from January 1, 2005. Accordingly, no payment of taxes will be accepted by bank branches unless the PAN of the tax payers is quoted on Challans ITNS 280 & 282 or TAN of the deductor on Challan ITNS 281, as the case may be. The branches may display a notice prominently stating that 'Quoting of PAN/TAN on Challans is compulsory from 1/1/2005' in the branches and not to accept challans without PAN/TAN from that date. The procedure for obtaining PAN/TAN is available in the website of Income Tax Department (http://www.incometaxindia.gov.in or http://www.tin-nsdl.com). The branches may guide the assessees to obtain PAN/TAN before depositing the tax. The facility of downloading the challan form No. 280 & 281 with pre-printed PAN/TAN number may also be given wide publicity through your designated branches.

23. Banking Cash Transaction Tax (BCTT)

(RBI/2005/43(DGBA.GAD.No.H-76/42.01.001/2005-06) dated July 5, 2005)

23.1 Banks were advised the procedure to be followed as regards levy of Banking Cash Transaction Tax on the cash withdrawal by the Government departments. Extract of the same is reproduced below:

"Government of India has introduced a new levy of 0.1%, called as Banking Cash Transaction Tax (BCTT) through Finance Act, 2005 which has come into effect from June 1, 2005. The BCTT is levied on the value of taxable banking transactions which have been defined as under:

            a) Withdrawal of cash (by whatever mode) exceeding a specified limit on any single day from an account other than a savings bank account with any scheduled bank.

            b) Receipt of cash exceeding a specified limit from any scheduled bank on any single day on encashment of one or more term deposits, whether on maturity or otherwise.

 

23.2 The BCTT is also payable, among others, by an office or establishment of the Central Government or a State Government. Accordingly, Central Government Offices or establishments will be liable to pay the BCTT on the amount of cash withdrawn by them for their use, if the amount withdrawn by them is in excess of Rs.1, 00, 000/- (Rupees one lakh), in a single day from a single account.

23.3 In this connection, Government of India has observed that deducting the BCTT from the cheques' amounts drawn by Government Departmental Officers by Agency Banks is not correct. Banks are, therefore advised to stop the practice forthwith.

23.4 In order to enable Banks to recover the tax from the Government departments, banks are advised to directly debit the Government account through the payment scrolls. The BCTT may be shown just below the relevant cheque amount in the payment scroll, indicating in clear words "Banking Cash Transaction Tax".

23.5 Insofar as the reporting and settlement of the collections with the Reserve Bank of India, CAS, Nagpur and ZAOs of CBDT is concerned, banks will follow the procedure already prescribed for the purpose with respect to "Direct Taxes"."

24. Obligation of Scheduled Banks to furnish information on Banking Cash Transaction Tax (BCTT)

(RBI /2005/ 85 (DGBA. GAD. No. H- 414 /42.01.001/ 2005-06) dated July 30, 2005)


 

24.1 As per Rule No. 5 of the Government Notifications No. 156/2005, dated May 30, 2005 scheduled banks are required to furnish a statement of number of taxable banking transactions entered into and Banking Cash Transaction Tax collected during the month on or before the expiry of the month immediately following the relevant month on a computer media.

24.2 Banks may, therefore, furnish the information in the manner and media as prescribed in the Rules at the address mentioned below:

Directorate General of Income Tax (investigation)

E-2, ARA Centre, 3rd Floor, Jhandelwalan Extension

New Delhi 110 055

Banks may download the above Notification and forms from the website www.taxmann.com.

25. On Line Tax Accounting System (OLTAS)-

Improvement in Data Quality

(DGBA.GAD.No.3774/42.01.034/2007-08 dated October 9, 2007 RBI/2007/206 & DGBA. GAD. No.6212/42.01.034/2007-08 dated December 6, 2007)

25.1 Discrepancies in challan details uploaded to TIN

It was brought to the notice of banks that the OLTAS data uploaded to TIN by them do not match with the relative data submitted through TDS/TCS returns submitted by deductors. Common irregularities observed were:

(i) Date of Realisation is digitized as Challan Tender Date in the data uploaded through OLTAS.

(ii) Uploading of incorrect Challan Serial Number, Major Head, PAN/TAN etc.

(iii) Challan Serial No. not Stamped on challan counterfoil.

(iv) Amount indicated against single challan bifurcated into two amounts and reported in two challans.

Banks were advised to avoid the above errors and be more careful while capturing and uploading OLTAS data.

25.2. Data Quality Concerns

In order to achieve accuracy in reporting PAN & CIN to TIN the agency banks were advised to:

            i. use bulk PAN verification facility from TIN-NSDL site;

 

            ii. insist on proof of PAN whenever necessary and

 

            iii. ensure CIN given to the customer is the one uploaded to OLTAS. Care to be taken especially with reference to 'date of tender'.

 

26. Introduction of Computerised Receipts and Improve in Data Quality

(RBI/2008/328 & DGBA GAD. No.H.12070/42.01.034/2007-08 dated May 22, 2008)

The Agency banks were advised to issue computerized receipts for challan payments of OLTAS transactions comprising of relevant data as per prescribed proforma i.e. annex A-IV-I & II w.e.f June 01, 2008. The agency banks further advised to follow additional guidelines as under:

            i) Maker Checker System of Data Entry: Maker Checker System in which the data entry by one is checked by another to exclude the possibility of wrong data entry, may be strictly followed.

            ii) Software Alert: To minimize the data entry error, the data entry software in the collecting branches should provide alert message where PAN/TAN is not entered or structurally invalid data is entered or PAN is entered in the column meant for TAN or where there is mismatch between minor head and assessment year etc.

            iii) Software validation: You may ensure that the software validations issued by Income Tax Department have been incorporated in your system.

            iv) Quality assurance at Bank level: Quality assurance in respect of collection of Government Tax is expected from all agency banks.

            v) Re-upload of rejected file: the OLTAS data file may be validated through the file validation utility (FVU) before uploading the same to TIN to eliminate rejection of data file at NSDL.

 

27. Cut off time for e-Payment transactions pertaining to Government Revenue

(RBI/2008/275 & DGBA. GAD. No.10577/42.01.038/2007-08 dated April 3, 2008)

Banks authorized for e-payment of CBDT revenue were advised that payment under OLTAS received up to 8.00 p.m. may be treated as received on the same day and those received thereafter be treated as received on next working day.

28. Mandatory Electronic Payment of Tax by Certain Categories of Taxpayers w.e.f. April 1, 2008

(RBI/2008/280 & DGBA. GAD. No.H.10875/42.01.038/2007-08 dated April 10, 2008)

CBDT has made electronic payment of taxes mandatory for the following categories of taxpayers:

            a. A Company

            b. A person (other than a company) to whom provisions of Section 44AB are applicable

 

Banks were, therefore, advised to instruct their branches:

                      i) to identify the status of the corporate taxpayers from the name. The 4th digit of PAN of all corporate asseessee would be "C". Hence physical challans from such asseessee should not be accepted across the counter.

 

                      ii) To accept physical challans at the bank counters from taxpayers under Sec. 44AB of IT Act as the responsibility of making e-payment rests primarily with the taxpayers.

 

                        iii) to make available acknowledgement for e-payment immediately on the screen.

                        iv) to ensure that the transaction id of e-payment is reflected in the bank's statement.

                        v) to display on its e-payment gateway page, the official/s to be contacted in case the taxpayer faces any difficulty in making the payment, completing the e-payment transaction, generating the counterfoil etc.

                        vi) to give ITD and NSDL a list of officials with contact particulars to be contacted if required for any problems faced by ITD or tax payers.

 

(RBI/2008/321 & DGBA. GAD. No. H. 11895/42.01.038/2007-08 dated May 15, 2008)

The Agency Banks were supplied a CD containing area-wise PAN and names of taxpayers coming under Section 44AB of IT Act for the financial year 2007-08 and to take following action in case of submission of challan with cheque by taxpayers covered under Section 44AB of IT Act, which can be verified from the CD containing area wise PAN and names of the taxpayers coming under Section 44AB:

                        i) Request the taxpayer to route his payment through e-payment mode.

                        ii) If he asserts his inability to do so, accept the cheque with a warning that it will not be accepted for the next payment and he may be liable for proceeding under the Act.

 

                        iii) Help the taxpayer to open net- banking account in the branch.

                        iv) A short write up and steps to be followed to make e-payment (as per annex IV) for the knowledge of tax payers was also provided to the banks.


 

29. Permissible Period of Remittance of E-payment of Government

Transactions – Private Sector Banks

(DGBA.GAD.No.H.551/42.01.011/2008-09 dated July 18, 2008)

The remittance period in respect of Private Sector Banks and IDBI Bank for all Government transactions including EASIEST and OLTAS received through e-payments would be T+1 working day (including put through date) w.e.f. August 1, 2008.

30. Permissible Period of Remittance of E-payment of Government

Transactions – Public Sector Banks

(RBI/2008/09/97-DGBA.GAD.No.H. 549/42.01.011/2008-09 dated July 18, 2008)

The remittance period of all Government transactions including EASIEST and OLTAS received through e-payments by Public Sector Banks would be T+2 working days (excluding put through date) w.e.f. August 1, 2008 and T+1 working day (excluding put through date) w.e.f. January 1, 2009.

                        31. Recovery of Interest from Public Sector Banks on delayed remittances of Government Receipts into Government Account

(RBI/2009/463-DGBA.GAD No. H-9284 /42.01.011/2008-09 dated April 28, 2009)

(i) Applicability of exclusion of put through date for the transactions (relating to revenue receipts) affected during the period 1/5/2005 to 31/12/2006 for the cases in which penal interest has already been paid:

As per the extant instructions, the 'Put Through Date' was excluded from the prescribed remittance norms for calculating delayed period interest for remittance of Government revenues and these instructions were made applicable in pending delayed period interest cases where the banks had not paid the interest. It was decided by Controller General of Accounts to extend the benefit of exclusion of the 'Put Through Date' from the time period calculated for remittance of Government receipts to those banks also which had paid the penal interest during the period from 1/05/2005 to 31/12/2006 on the instructions existing at the time they made the payments. The excess payment of penal interest paid by the banks will be adjusted against the subsequent claims of delayed period penal interest against them.

                         

(ii) Permissible period for remittance of Govt. revenues into Govt. account for outstation transactions under Electronic Accounting System in Excise and Service Tax (EASIEST):

It has been decided that a maximum period of T+5 working days (excluding put through date) for outstation transactions will be allowed. This dispensation will not be applicable on e-payments (payment made through internet) for which separate instructions have been issued vide our circular No. RBI/2008/09/97 dated July 18, 2008.

(iii) Levy of petty amount of penal interest on delayed remittances of Government receipts:

It has been decided that the petty claims of delayed period penal interest involving amount of Rs.500/- or below, will be ignored and excluded from the purview of penal interest w.e.f. January 1, 2008.

(iv) Waiver of penal interest due to teething problems experienced by dealing branches during the initial period of OLTAS:

Considering the various problems which had arisen during the initial period of implementation of OLTAS before the system stabilized, it has been decided to exempt the six quarters (i.e. 1/04/2005 to 30/09/2006) from the purview of penal interest.

Further, these instructions will not be applicable to remittance of funds under the Deposit schemes viz. PPF/SCSS etc. of Ministry of Finance.

 

Annex I

ACCOUNTING PROCEDURE RELATING TO ON-LINE TAX

ACCOUNTING SYSTEM (OLTAS)

----------------------------------------------------------------

1. Procedure for acceptance of taxes at the receiving branches

1.1 A taxpayer can pay direct taxes at any authorised branch of the authorised bank either in cash, direct debit to account or by a cheque/draft drawn on the same bank or another bank/branch at the same centre where the payment is made. The payment of tax by outstation cheques/drafts can also be made at any authorised bank, or through an electronic means of remittance to the authorized bank / branch. For every payment there should be a challan in the prescribed format. The challan format is a single copy challan with the main challan at the top and the taxpayer's counterfoil at the bottom of the challan (Specimen at Annexure 'A').

1.2 At the counter of Receiving Bank Branch

The receiving clerk/ teller of the receiving branch will have to check up the following points while accepting the payment: -

a. Whether main portion of the challan and the taxpayer's counterfoil form have been filled in properly and the amount and major head of account to which the amount is to be accounted /credited is correctly recorded therein;

b. Whether details of the Permanent Account Number (PAN) or Tax Deduction Account Number (TAN), name and address of the taxpayer, assessment year and nature and type of payment are properly filled in. The amount should be written correctly both in words and figures.

c. Whether the Permanent Account Number (PAN) / Tax Deduction Account number (TAN) has been quoted in the challan at the prescribed place. U/s 139 A (5) (b) of the Income Tax Act, quoting of PAN is mandatory. Similarly, u/s 203A of the Act, quoting of TAN is mandatory. This number, as quoted by the taxpayer should be validated (checked to see whether it is in conformity with the valid PAN/TAN structure) and the designated banks accepting tax payment should ensure that the challans for payment are accepted only when a valid PAN is quoted in the challan. However, where the taxpayer indicates that he has already applied for allotment of PAN or TAN but has not yet been allotted the same, the tax payment challans may be accepted by the bank provided the tax payer indicates PAN/TAN application number in the challan. In such cases it should invariably be ensured that the full address of the taxpayer has been mentioned in the challan.

1.3 After scrutinizing the challan and satisfying himself that the amount of cash, cheque or draft tendered agrees with the amount shown in the challan, and also that the cheque is not post dated/stale the receiving teller or counter-clerk of the branch will issue a paper token to the tenderer to facilitate delivery of the counterfoil receipt to him. In the case of challans deposited with cheque or draft drawn on other bank branches, the counterfoil receipt will be issued only on realization of the amount of the cheque or draft and hence the paper token should bear the date on which the same will be available.

1.3.1 Challans tendered with Cash

A challan tendered with cash, if found in order after scrutiny, will be stamped 'CASH RECEIVED'. The bank will also stamp both the main portion and the taxpayer's counterfoil of the challan with a stamp mentioning the name of the bank & branch, the BSR code the branch (7 digits), date of deposit (DDMMYY) of the amount and unique serial number of the challan (5 digits). The stamp will be impressed on both the main portion as well as the taxpayer's counterfoil of the challan. Care must be taken to ensure that the impression of the receipt stamp is clear and legible.

An authorized official of the branch will sign in full the taxpayer's counterfoil of the challan and initial the main copy of the challan having received the amount. In the taxpayer's counterfoil, the amount received will be indicated in both words and figures. The receipted taxpayer's counterfoil will be returned to the tenderer and the main copy will thereafter be passed on for scrolling in the Receipt scroll.

1.3.2 Challans tendered with Cheque/Draft

A challan tendered with cheque/ draft will be branded with a 'double date stamp' to indicate the date of tender of the instrument as well as the date of realization thereof. It may be possible that some branches might be following the practice of branding the challans with an inward date stamp as soon as the challans are tendered over the counter. In that case the double date stamp may not be necessary. However, it will be ensured that the inward date stamp is invariably branded on both the main copy and the taxpayer's counterfoil of the challan.

The checking official will initially ensure that there is no difference between the amount of cheque/ draft and the amount recorded in the challan by the tenderer. The cheque/ draft will thereafter be sent for realization. Subsequently, on realization of the cheque/draft, the date of realization will be indicated on the double date stamp or in the space in the challan as the case may be. The bank will also stamp both the main and the taxpayer's counterfoil of the single copy challan with a stamp mentioning the name of the bank & branch, the BSR code the branch (7 digits) date of deposit (DDMMY) of the amount and unique serial number of the challan (5 digits). After signing the challan for having received the amount, the taxpayer's counterfoil will be returned to the tenderer against the surrender of the token.

1.3.3 Numbering of Challans

Running serial number will be given for all the challans (both paid by cash and by cheque) for each day. It must be ensured that the serial number on each challan issued on a particular day should be unique to trace it subsequently. The bank must therefore ensure that the serial numbers given to the challans deposited with cash do not overlap with the serial numbers given to the challans against which cheques have been realised on that day.

Counterfoil of the challans tendered along with cash and cheque/draft payable at the same branch will be returned to the tenderer duly receipted at the counter. The challans tendered with cheques/drafts drawn on a different branch of the same bank or any other bank situated at the same centre, the tax-payer's counterfoil will be returned duly receipted not later than the working day following the day fixed under the Rules of 'Local Bankers' Clearing House' for return of unpaid instruments of any day's clearing.

1.4.1 In case of challans tendered with cheque/ draft, the date of realization of the cheque will also be stamped on the main portion of the challan, which will be retained at the bank for onward transmission to Zonal Accounts Office (ZAO) along with the Receipt Scroll. Although as per the Income Tax Act the date of presentation of cheque/ Demand Draft realized will be treated as date of payment of tax, the cheque/ Demand Draft will be scrolled only after realization.

1.4.2 Double Date on Receipted Challan

The main portion of the challan through which a cheque/ draft is deposited will, therefore, have two dates as under:

i) Date of tender : DDMMYY (in the rubber stamp acknowledgement)

ii) Date of realization: DDMMYY (at the place indicated in the challan)

In case of cash tender the 'Date of tender' and 'Date of realization' will be the same.

1.4.3 The collecting bank will not issue receipt in any other format.

2. Preparation of Scrolls by the Collecting Branch

2.1 A running serial number will be given to all the challans received at a bank branch counter on each day against which cash payments have been made or cheques/ drafts have been realized on that date.

2.2 All the challan fields such as name and PAN, the serial number, date of deposit and BSR code of the branch are required to be captured when the challan is deposited by the tax payer at the bank counter. The data structure of the fields of the challan for which data has to be captured and transmitted will be as informed to the banks by the Income-tax Department. Permanent Account Number (PAN) and the name of the taxpayer will invariably be incorporated in the Receipt & Payment Scroll.

2.3 At the end of customer banking hours, the bank branch should identify all those challans against which payment has been received in cash for the day or for which payments by cheque/draft have been realised for the day. As the details of all these challans is already in the bank's computer system, the branch should generate a file containing all the challan data for which payments have been realised for that day and transmit it to its Nodal Branch for onward transmission to the Income Tax Department's TIN through the banks' Link Cell. However, the non- computerized/ non- networked authorized branches should ensure that data is transmitted from it's nearest computerized/ networked branch to the Nodal Branch. It should be ensured that no challan for which payment has been realised on that day is left out. A running scroll serial number extending through a financial year (1st April to 31st March) will be given to the records relating to each type of tax (major head) which are transmitted on a particular day. The complete data structure of records and the file which is to be transmitted by the bank to the Department will be in the format prescribed by the Income-tax Department. The collecting branch will in no case alter the online data file at its end after it has been transmitted to the Income Tax Department.

2.4 Treatment of Clearing Returns

The collecting branch should also identify all those challans against which instruments were returned unpaid. Such instruments along with related challan should be kept separately in the bank for taking further necessary action as deemed fit.

2.5 The collecting branch will also generate separate printouts of the scrolls in Form and summary in Form based on the type of tax (major head-wise) on a daily basis from the challan data on its computer which has been transmitted to the Income-tax Department. The same running serial number extending through a financial year (1st April to 31st March), which was given to the scrolls transmitted for the relevant day, prefixed by the appropriate abbreviation of the type of tax (major head) concerned, will be printed on the scroll. The collecting branch will in no case generate any printed scrolls or summary from data which is changed in any manner from the data earlier transmitted to the Department. Thus the scrolls generated by the branch will exactly match the scrolls generated by the RCC from the data transmitted to the Department's TIN on-line by the bank. Thereafter, the branch will prepare a set of computer printed summary and receipts scrolls and attach with each scroll the physical challans arranged in the same serial order in which they are entered in the scrolls. At the beginning of the next working day, the receiving branch will forward the same to the Nodal Branch for onward transmission to the ZAO.

2.6 Transmission of Error Records

In case of any error by the collecting bank branch in reporting the amount of payment made by a taxpayer or major head of payment, the bank will transmit the corrected information on-line to TIN through an error record, the format for which will be as prescribed by the Income-tax Department. Rectification of the errors in the amount and the head of account will also be reported to ZAO through 'Error Scroll" to be sent through Nodal branch. Only the amount of tax payment as reported by the bank to the TIN will be accepted by the Income-tax Department as the payment made by the taxpayer.

3. Procedure for Payment of Income Tax Refund Orders (ITROs)/ECS

3.1 Direct tax refund work is entrusted to only one branch of an authorized bank generally Reserve Bank of India, State Bank of India or its Associate Banks at an ITD centre / a District. The Refund Orders will be presented to the branch by the taxpayer for transfer to his account with the same branch. Alternatively, it might be received through clearing. The specimen signatures of the officers of the Income-tax department who are authorized to draw refund orders will be sent to the paying branches concerned in advance by the Income-tax authorities. The specimen signature will be duly certified by an officer of the Income-tax Department whose specimen signature is already on record with the branch. Any change in the authorised official will be advised to the branch concerned immediately. The relieved officer will attest the specimen signature of the relieving officer. While passing the refund orders for payment, the passing official should exercise utmost care apart from the precautions usually exercised by the banks in connection with payment of Negotiable Instruments, the instructions issued by Controller General of Accounts as well as Reserve Bank from time to time. The payee is required to affix his signature in the space provided for 'Claimants signature' on the reverse of the Income Tax Refund Order (ITRO).The procedure relating to Refund Advices will continue as at present except that advices of paid ITROs and printed payment scrolls will no longer be sent by the bank to the Income-tax Department.

3.2 As in the case of receipts, refunds are required to be classified by the paying branch according to the type of tax under which the refunds are made. Separate major head wise payment records will be maintained in respect of payment of ITROs.

3.3 Direct tax refunds can also be credited directly to the taxpayer's bank account through Electronic Clearance Scheme (ECS) of RBI. In order to avail of this facility, the taxpayer gives a mandate by mentioning type of his bank account (Savings or Current), account number and bank branch code (9 digit) in his Return of Income. After processing of the taxpayer's Returns and determination of the refund by the Assessing Officer, all taxpayer's refunds (in which credit through ECS has been sought) in the jurisdiction of an RCC are automatically consolidated on the computer system at the RCC. All this refund data is downloaded, encrypted and copied onto a magnetic media (floppy or rewriteable CD) or transmitted electronically. This is sent by the RCC to the local ZAO as well as refund issuing branch of RBI or SBI. After validating the data in the file, the bank debits the Income-tax Department Account for the total amount of the refunds and thereafter issues instructions through clearing to the different local braches of the banks where the taxpayer's accounts are located to credit the taxpayer accounts with the amount intimated by the Department. This single debit to the Department's account appears in the payment (refund) data transmitted by the bank to the Income Tax Department for that day. In case any of these credits to the taxpayer's accounts are not effected due to reasons like closing of the account etc., the same is later accounted for by a separate minus debit entry for ECS Return in the Income Tax Department's account and is intimated to the Income Tax Department through the payment (refund) data transmitted for that particular day. The files in the electronic media (floppy or rewriteable CD etc.) are returned along with the computer printed payment (refund) scroll to the ZAO while the same data is transmitted online by the bank to the Income Tax Department through the Income Tax Department's Tax Information Network (TIN).

4. Preparation of Payment (Refund) Scrolls

4.1 The procedure for preparation of payment scrolls will be the same as the procedure applicable to receipts scrolls.

4.2 The scrolls will be made into set similar to the set relating to receipts except that instead of the challans, the paid Refund Orders will accompany the scrolls. The entire data regarding the paid refund vouchers will be transmitted electronically by the paying bank to the Link Cell for onward transmission to the Department's TIN while the physical scrolls with the paid Refund Order will be forwarded to the ZAO through the Nodal Branch. If the Nodal Branch is not locally situated, all the above documents (receipt/payment scrolls etc.) should invariably be sent by Registered Post.

4.3 In the case of ECS Refunds, the data will be transmitted on-line to the Link Cell and subsequently to the Income Tax Department while the same ECS detail on electronic media will be sent to the local ZAO by Paying Bank through the Nodal branch

5. Loss of Counterfoil by the taxpayer

5.1 In the event of loss of receipted challan counterfoil by the depositors, the bank branches may, on receipt of a specific request in writing for issue of a certificate of credit from assessees, issue the same to the depositor based on their record after satisfying themselves about the bonafides of the applicant in each case and may charge a nominal fee at its discretion. The certificate should mention the challan details i.e. amount, bank name and branch, BSR Code and Date of Deposit of cheque/cash, major head, challan serial number, date of realisation of cheque /date of deposit of cash and Collecting branch scroll number and date on which details of tax payment have been transmitted earlier.

6. Functions of Nodal Branch

6.1 Nodal Branch will be responsible for the prompt and accurate transmission, accounting of the collections/refunds reported to it daily by all the receiving branches under its jurisdiction (including its own receipts). It will also be responsible for prompt remittance of the collections of all the receiving branches linked to it (including its own collections) to the Government Account at RBI, CAS, Nagpur. It will also be responsible for reconciliation of figures with the ZAO.

6.2 On receipt of on-line data regarding all the challans realised for a particular day from the Collecting Branches, the Nodal Branch will take the following action on day-to-day basis:

a. It will collate the challan data on its computer system and transmit the data in the format prescribed by the Income Tax Department to its Link Cell for onward transmission to the Departments TIN on the same day after giving a common Nodal Branch scroll number and date to all the challan records being transmitted on that day.

b. It will also generate a copy of the summary and main scroll based on the computer data in a floppy or other media (as informed by ZAO) and transmit it to the ZAO on the next working day.

c. On receipt of the hard copy of the computer-generated Branch scrolls from the collecting branch, the Nodal branch will validate that these computer-generated branch scrolls exactly match the data transmitted earlier by the collecting branches. It will consolidate these computer printed Branch scrolls (with challans) received from all the branches including its own along with the main scroll by stitching the scrolls together Major head-wise. It will also generate a computer printout of the Major head-wise Main scrolls and Summary. It will then forward these (with challans) to the ZAO concerned on a daily basis.

d. Second set of scroll prepared in the same manner without challans as discussed at (c) above will be retained by the Nodal branch for its record.

e. The Nodal branch will also similarly generate computer printed separate main scrolls for payments (i.e. refunds), and forward them along with the paid ITROs to the ZAO. It will also forward ECS refund details on electronic media to the local ZAO. The refund data (in respect of paper ITROs and ECS refund) will be transmitted on-line by the Nodal Branch to TIN through the Link Cell. It will retain the advice/advices of the paid ITROs.


f. During the first 15 days in April every year, the nodal branches will transmit and prepare two separate sets of scrolls – one normal scroll pertaining to April transactions and the other one pertaining to March transactions (which means scrolls of cheques / drafts / ITROs tendered and cleared upto 31st March by receiving branches and sent to the nodal branch subsequent to 31st March but before 15th April) - these will be scrolled by nodal branch as March residual account. The nodal branches will intimate the link cell at Nagpur for inclusion of these transactions as March transactions. The nodal branches will send another scroll for April transactions prominently indicating the month of account. Any cheque/draft tendered on or before 31st March and realised on or after 1st April will be treated as part of the April transactions. However, in light of the instruction that data for all challans for which payment has been realised on a given day should be transmitted online to the Income Tax Department on the same day, separate March residual scroll should only be needed in exceptional cases.

g. The nodal branch will pass on the consolidated amount accounted by it to its Link Cell on day-to-day basis.

7. Crediting the tax collection to Government Account

7.1 The Nodal Branch acts as a pooling centre for all the receiving branches coming under its control and it is responsible for reporting of the transactions (along with all the related documents i.e. Challans and scrolls) to the ZAO. It is also responsible for transmitting the challan data for all these transactions to its Link Cell at Nagpur for onward online transmission to the Income Tax Department as well as for crediting the amount collected to Reserve Bank of India (Central Accounts Section or CAS), Nagpur.

7.2 The Nodal Branch will prepare a daily memo and send it on a daily basis to its Link Cell at Nagpur (GAD, Mumbai in case of SBI) which in turn will make a daily settlement with RBI, CAS, Nagpur.

7.3 The Link Cell of banks at Nagpur will consolidate the challan data received from the Nodal Branch for transmission to the Department's Tax Information Network (TIN) and will also monitor the daily receipts and check the accuracy of the daily memos received from the Nodal Branches. The Link Cell will then transmit the daily memos to CAS, RBI, Nagpur.

7.4 The Nodal Branches of the banks will carry out monthly reconciliation with ZAOs of the amount settled by them with their Link Cell at Nagpur. On the basis of their records the ZAOs will verify the statements received from the Nodal Branches both major head-wise and Nodal Bank-wise. In case of any discrepancy, the Nodal Branch will carry out the corrections immediately and adjust the difference in the amount already credited / debited to the CBDT's account through its Link Cell at Nagpur under information to the ZAO.

7.5 For the purpose of final reconciliation of the transactions with ZAOs and the Link Cell, the CAS, RBI, Nagpur will generate a monthly statement and furnish the same to ZAO and the Link Cell of the banks. RBI, CAS, Nagpur will furnish by 20th of the following month, a monthly analysis indicating major head-wise receipts / refunds etc. to the CCA, CBDT.

8. Payment of interest on delayed transfer of tax collections

8.1 The tax collections effected by the designated branches of the authorized banks have to be credited to the Government Account, promptly on day-to-day basis. The maximum number of days allowed for crediting tax collections to Government Account at CAS, Nagpur is as under:

            i. T+3 working days for all banks except private sector banks

            ii. T+3 days for private sector banks and IDBI Ltd

 

8.2 If there is any delay beyond the period prescribed above, the banks are liable to be charged interest for delayed period. The interest for delayed remittance as mentioned above is to be quantified and collected from the defaulting bank by the ZAOs. The rate of interest to be charged is Bank Rate as prevailing (which is generally notified biannually on May 1 and November 1) plus 2% or as decided by Reserve Bank in consultation with CGA from time to time.

9. Accounting of "March" transactions

9.1 Reserve Bank, Central Office, Mumbai will issue in the month of February each year special instructions to all banks collecting direct taxes regarding the procedure to be adopted in accounting the March transactions.

9.2 The Nodal banks will be receiving scrolls relating to March of the previous Financial Year in April of the current year. In order to account for the entire collections of March in the same financial year the Nodal banks have to follow the following procedure during the month of April:

The nodal banks have to prepare two sets of separate scrolls - one pertaining to March residual collections (payments realized from taxpayer's account before 31st March) and another for April transactions during the first 15 days in April. They should ensure that all the tax collections made by the receiving branches upto 31st March are accounted as "March Residual Transactions" and should not be mixed up with the transactions of April which fall in the financial year. The main scrolls for March transactions prepared from 1st to 15th April are to be distinctly marked as "March Residual".

9.3 It may also be noted that all the cheques / amount realized on or before 31st March should be treated as transactions relating to the current financial year and should be accounted for as such under the head "March or March Residual Transactions" in the current financial year.

9.4 While reporting to their Link Cell in Nagpur, the Nodal banks should send two sets of figures distinctly showing March Residual and April Transactions separately upto 15th April.

9.5 The date-wise monthly statements should also be prepared in two sets, one pertaining to March Residual Transactions and another relating to April Transactions.

10. Special arrangements during the month of March every year

10.1 The branches should follow the procedure explained in the earlier paragraphs meticulously and ensure that the collections made towards direct taxes are passed on promptly for credit to Government Account through the Nodal Branch / Link Cell. However, during the second fortnight of March every year, wherever the receiving branches and Nodal branch are situated locally, a special messenger system should be introduced by the receiving branches. All efforts may also be made to provide the collection figures on daily basis to the ZAO during the second fortnight of June, September and December every year, for onward transmission to the Government for monitoring, estimates etc.

11. Monitoring Committee - holding of periodical meetings

11.1 For the smooth functioning of the revised scheme for collection and accounting of direct taxes by the Authorised Banks, the Monitoring Committees consisting of officials from Nodal Banks/local authorities of the banks, ZAO and I.T. Department will be formed at every Zonal Accounts Office centre. The Committee will meet half-yearly and discuss various issues connected with direct tax work such as accounting, scrolling, reporting, remittance and reconciliation etc. and make efforts to sort out the problems at its own level. Further, annually there will be a special Monitoring Committee meeting in which very senior officials from CBDT, RBI, I.T. Department and banks will participate and redress the various problems being faced by the banks, ZAOs and I.T. Department in the fields. Banks will ensure that the necessary follow-up actions are taken on the Minutes of such meetings.

12. Redressal of public grievances

12.1 Each Authorised Bank should have an effective procedure for dealing with public complaints at the branches rendering service to Government Departments or members of the public as prescribed, from time to time. In case the bank detects a mistake in reporting of a tax payment or the major head of tax payment, either suo moto or being brought to its notice by the tax payer, the bank will promptly transmit the error record (as described earlier at paras 2.6 and 7.4) to TIN. This is imperative as the Income Tax Department will give credit to a taxpayer's on the information transmitted by the bank to TIN.

Annex II

OLTAS

User Manual for File Segregation Utility (FSU)

Introduction

The FSU will be used by banks to generate a valid file from invalid input file and corresponding error file. This user manual will enable the bank users to better understand the functionalities provided in this File Segregation Utility.

Intended Users:

This manual is intended for the Link Cells of banks participating in OLTAS.

Conventions used

Detailed information about each field or button is available in the Field Description table following every task.

1. Overview

FSU in a utility which helps in generating a valid OLTAS file by removing the erroneous records. If you have an OLTAS file and the error file corresponding to it, this utility will help you to get rid of the erroneous records and make a new correct file. It removes the rejected records by reading the error file and generates a new file consisting valid records only with auto-generated RT04 records. This correct file can be uploaded to OLTAS site. All the rejected records are separated and kept in other file for your reference.

2. Functionality

When you open the SPECIAL_FVU.exe file a utility will be seen as below.

 

 

Figure 1

The utility contains name of utility at the top, buttons for minimizing and closing the utility, four text fields and four buttons named "Browse", a start button and a cancel button. A copyright message and version number will also be visible.

The user is required to enter valid inputs in all the four text fields described below.

A. Input Base File:

Give the full file path of the base file. This base file is the file which has got rejected due to some errors. You can select the file by clicking on browse button. It will show you an 'open' box as displayed below (Figure 2). Browse to the required folder, select the file and then click open.

Input file name should be in "ddmmyyfv.bnk" format only.

 

Figure 2

File extension should contain valid bank code.

B. Input Error File:

This is the error for the Input base file. (The one selected in step 1) The error file can be downloaded and saved from OLTAS site. You can also use the error file generated by OLTAS link cell utility. You need to give the full path of the error file. The browse button on the right hand side can be used as explained above. The error file contains the file name for which errors are found. This name should match with input base file. User should not change this file. Also if the correct error file is not used, following message will be shown and utility will get stopped (Figure 3).

There is no validation for name of the input error file.

 

Figure 3

Note : Output valid file will not get generated correctly if any one out of two input files has got tampered. Also Error file generated from FVU or obtained from OLTAS site is acceptable. NO OTHER formats should be used, as they may give wrong results.

C. Output base file:

This is the output valid file which can be uploaded to OLTAS site or validated through FVU. Full path of the file needs to be specified. The filename can be same as input base file name if the location is different else it will get overwritten to the input base file. Use browse button for browsing to required folder and then enter the required filename. The extension of the input base file and output base file should match.

a. Field MAJ_HD_CD, TOT_NO_OF_RFND, TOT_NO_OF_CHLN, TOT_NO_ERR_RFND, TOT_NO_ERR_CHLN, RFND_TOT_AMT, CHLN_TOT_AMT in RT04 are calculated from the records data present in output valid file.

b. No_Of_Nodal field will be calculated from the records data present in Output Valid File i.e. distinct ZAO Codes present in Output Valid File.

c. Transmission date for every RT04 will be same as ddmmyy part of the Output Valid File Name.

d. Field RFND_DEBIT_DT of RT04 is kept BLANK.

e. In a particular RT08 R / N combination, if there is error in any of the records, both the records will be rejected and put into the Output Error File.

The output base file name should be in format "ddmmyyfv.bnk"

D. Output error file :

The utility will put all the rejected records in this file. User need to give the full path for this file. There is no validation for the name of this file.

Start Button:

After entering valid filenames in all the four fields as above, click start button. A message will be shown after successful completion of the process.

Cancel Button:

Use Cancel button to close the utility.

Annex III

Format for Nodal Branch Daily Main Scroll (Receipts)

1

NODAL BRANCH SCROLL DATE (DD/MM/YYYY)

 

 

2

BSR CODE

 

 

3

DATE OF RECEIVING BRANCH SCROLL (DD/MM/YYYY)

 

First six fields

4

TOTAL TAX AMOUNT

 

 

5

TOTAL NO. OF CHALLANS

 

 

6

DO-ID

 

 

 

#

MAJOR HEAD

 

 

#

AMOUNT

 

Block

#

NO. OF CHALLANS

 

 

 

#

MAJOR HEAD

 

 

#

AMOUNT

 

Block

#

NO. OF CHALLANS

 

 

 

#

MAJOR HEAD

 

 

#

AMOUNT

 

 

#

NO. OF CHALLANS

 

 

 

 

This block (shown above) will be repeated for as many times as no of tax heads are available.

NOTE:

1) The record for one receiving branch should be contained in one line and values must be comma separated.

2) Carriage return or linefeed [i.e. ENTER KEY (↵)] indicates the end of the record for one receiving branch.

3) Sequence of block (majhd, amt, no_challan) is not necessary but increasing order is preferable.

4) Example:

First six fields block block block

30/11/2005, 0230001, 25/11/2005, 6600, 22, PNE, 0020, 200, 2, 0021, 100, 1, 0024, 300, 4, 0026, 400, 2, 0031, 500, 1, 0032, 600, 2, 0033, 700, 1, 0034, 800, 1,

0070, 900, 1, 0036, 1100, 5

 

First six fields

 

Block

 

Block

32

Detailed example

First six fields    block    block    block

13/11/2005, 0000455, 12/11/2005, 5775, 18, PNE, 0020, 1525, 6, 0021, 200, 2, 0023, 100, 1, 0026, 300, 2, 0031, 600, 1,0032, 750, 2, 0033, 550, 1, 0034, 800, 2, 0070, 950, 1

13/11/2005, 0003861, 12/11/2005, 9950, 17, PNE, 0020, 3500, 5, 0020, 2250, 3, 0023, 300, 1, 0026, 400, 1, 0031, 500, 1,0033, 600, 2, 0032, 700, 1, 0034, 800, 2, 0070, 900, 1  

13/11/2005, 0004618, 11/11/2005, 640112, 22, PNE, 0020, 629367,20, 0021, 10745, 2  

13/11/2005, 0230011, 11/11/2005, 47071, 2, PNE, 0020, 47071, 2  

13/11/2005, 0230116, 10/11/2005, 304648, 20, NSK, 0020,26942, 2,0021, 277706, 18  

13/11/2005, 0230004, 13/11/2005, 408134, 16, NSK, 0020, 407190, 15, 0021, 944, 1  

5) If nodal bank is sending the scrolls of two different dates for the same receiving branch in one DRS then their entry should be two different lines in the DRS file as shown below:

14/11/2005, 0002053, 12/11/2005, 5775, 18, PNE, 0020, 1525, 6, 0021, 200, 2, 0023, 100, 1, 0026, 300, 2, 0031, 600, 1,0032, 750, 2, 0033, 550, 1, 0034, 800, 2, 0070, 950, 1  

14/11/2005, 0002053, 13/11/2005, 9950, 17, PNE, 0020, 5250, 6, 0023, 500, 2, 0024, 300, 1, 0025, 400, 1, 0031, 500, 1, 0033, 600, 2, 0033, 700, 1, 0034, 800, 2, 0070, 900, 1  

14/11/2005, 0002034, 13/11/2005, 408134, 16, NSK, 0020, 407190, 15, 0021, 944, 1  

·        Observe first two lines of above DRS in which both lines contain same nodal branch scroll date and BSR code, which is a must in this case, but different details.

·        Date of receiving branch scroll is different which must be lesser then nodal branch scroll date.

·        Third line is regular row for other branch of the same nodal bank.

 

6) DATE: is date in DD/MM/YYYY format.

BSR CODE: is 7-digit numeric code.

DO-ID: is 3-digit alpha code.

MAJOR HEAD: is 4-digit numeric code.

AMOUNT and NO OF CHALLAN are numeric values.

Annexure-A-IV-I

Draft proforma of computer generated receipts to be issued by banks to taxpayers

 

Computer generated receipt

(to be issued by collecting bank branch to depositor of direct tax for deposit of Tax

Deducted at Source in Government account against challan form No.281)

Name of the bank collecting tax

 

Full name of deductor

 

TAN of deductor ( 10 characters )

 

Amount deposited :

 

(i) Income Tax

 

(ii) Surcharge

 

(iii) Education Cess

 

(iv) Penalty

 

Total amount deposited : (in figure )

 

Mode of deposit of tax (by cash / debit to account/ by cheque bearing No.)

 

Date of encashment of cheque (dd/mm/yy)

 

On account of Income Tax Deducted / Collected from companies (0020)/ Other than Companies (0021)

 

Minor head –Type of payment-(TDS/TCS deducted/collected by deductor OR demanded by department)

200/400

Nature of payment from which tax has been deducted or collected –(Give Section code)

Assessment Year (yyyy-yy)

 

Challan Identification number (CIN)

BSR code of collecting bank branch ( 7 characters )

 

Date of tender of cheque ( dd /mm /yyyy) ( 8 characters )

 

Challan Serial Number ( 5 characters )

 

Signature & seal of authorized signatory of collecting bank branch

 

Annexure-A-IV-II

Draft proforma of computer generated receipts to be issued by banks to taxpayers

Computer generated receipt

(to be issued by collecting bank branch to depositor of direct tax for deposit of Tax

Deducted at Source in Government account against challan form No.280)

Name of the bank collecting tax

 

Full name of taxpayer

 

PAN of taxpayer ( 10 characters )

 

Amount deposited :

 

(i) Income Tax

 

(ii) Surcharge

 

(iii) Education Cess

 

(iv) Penalty

 

Total amount deposited : (in figure )

 

Mode of deposit of tax (by cash / debit to account/ by cheque bearing No.)

 

Date of encashment of cheque (dd/mm/yy)

 

On account of Income Tax Deducted / Collected from companies (0020)/ Other than Companies (0021)

 

Minor head –Type of payment

 

Assessment Year (yyyy-yy)

 

Challan Identification number (CIN)

BSR code of collecting bank branch ( 7 characters )

 

Date of tender of cheque ( dd /mm /yyyy) ( 8 characters )

 

Challan Serial Number ( 5 characters )

 

Signature & seal of authorized signatory of collecting bank branch

 

 


 

Annex IV

How do I make online tax payment sitting at home/office?

Open a net-banking account with any of the banks listed above.

            i. Go to website incometaxindia.gov.in, click on 'pay taxes on-line'.

            ii. Fill in the required challan online. Help is available on screen as FAQ, downloads etc.

            iii. Make tax payment through net-banking account online.

            iv. A challan counterfoil will be available instantaneously on the screen with CIN (Challan Identification Number). The Challan Identification Number (CIN) on this counterfoil should be quoted in Return of Income.

            v. Print the counterfoil and also save it in the computer if possible.

            vi. Check if your payment has reached the Income Tax Department at https://tin.tin.nsdl.com/oltas/servlet/QueryTaxpayer.

 

**************

What are the advantages of paying taxes online

            i. You can pay taxes from any location at any time through your net-banking account

            ii. Instant transfer of funds from your account.

            iii. What you write on the e-challan will be directly sent to Income Tax Department.

 

Banks will not do any data entry.

            iv. You can save/print the challan copy and the receipt copy.

            v. As soon as your Bnak authorizes payment of the amount, you will receive a clear, legible receipt/counterfoil from your bank.

            vi. Transaction id of the e-payment transaction will be available to you in your bank statement.

            vii. You can check online if your money has actually reached the I-T department. For this you have to go to Tax information Network website:

 

https://tin.tin.nsdl.com/oltas/index.html

and click the box

CIN Based View

 

For detailed information please go to: incometaxindia.gov.in PAY TAXES ONLINE

IMP: In case of refunds adjusted against arrear demand, the normal refund should be attached with challan and sent to Bank by AOs as per earlier procedure.

 

Master Circular — Index

Sr.No.

Reference No

Subject

1.

DGBA.GAD.No.H-684/42.01.001/2003-04 dated January 9, 2004.

Amendments to Pink Book 'Accounting System for Direct Taxes'.

2

RBI 2004/135

DGBA. GAD.No.1142 /42.01.001/2003-04 dated April 2, 2004

Procedure for Collection of Taxes at Bank Branches - Customer Service

3

RBI/2004/131 DGBA.GAD.No.1008/42.01.034/2003-04 dated April 1, 2004

Introduction of On-line Tax Accounting System (OLTAS) - Branding of Rubber Stamp on copies of Challans

4

RBI/145/2004

DGBA.GAD.No.H-1068 /42.01.034/2003-04 dated April 16, 2004

Accounting Procedure for On-line Tax Accounting System (OLTAS)

5

RBI/2004/184

DGBA.GAD.No.H-1114/42.01.034/ 2003-04 dated April 29, 2004

Implementation of On-line Tax Accounting System with effect from June 1, 2004

6

RBI/2004/75

DGBA.GAD.No.H-69/42.01.034/2004-05 dated July 28, 2004

On-line Tax Accounting System (OLTAS) - Transmission of data to NSDL - Validation Checks

7

RBI/2004/326

DGBA.GAD.No.3278-3311/42.01.034/ 2004-05 dated December 31, 2004

Abolition of Sub-Agency Arrangements for Collection of CBDT Dues – OLTAS

8

RBI/2005/406

DGBA.GAD.5236/42.01.034/2004-05 dated March 29, 2005

On-line Tax Accounting System (OLTAS)-Funds Settlement - Reporting to RBI, CAS Nagpur

9

RBI/2005/466

DGBA.GAD.No.H.5801/42.01.034/2004-05 dated May 13, 2005

On-line Tax Accounting System (OLTAS) – Funds Settlement

10

RBI/2004/213

DGBA.GAD.No.H- 1169 / 42.01.034 / 2003-04 dated May 22, 2004

Accounting Procedure Relating to On-Line Tax Accounting System (OLTAS) - Clarifications

11

RBI/2004/181

DGBA.GAD.No.H-235/42.01.034/2004-05 dated September 15, 2004

On-line Tax Accounting System (OLTAS) - Participation of Branches

12

RBI/2004/164

DGBA.GAD.No.H-170/42.01.034/2003-04 dated September 4, 2004

Critical Issues regarding data capture of OLTAS data by banks


13

RBI/2005/411

DGBA.GAD.No.H-5287/42.01.034/2004-05 dated April 1, 2005

On-line Tax Accounting System (OLTAS) - Accounting Procedure relating to crediting of CBDT collections to Government accounts.

14

RBI 2005/412

DGBA.GAD.No.H5318 /42.01.034/ 2004-05 dated April 4, 2005

De-authorisation of bank branches

for collection of Direct Taxes

15

RBI/2005/81

DGBA.GAD.No.382/42.01.034/2005-06 dated July 26, 2005

OLTAS - File Segregation Utility developed by Tax Information Network (TIN)

16

RBI/2005/39

DGBA.GAD.No.H-42/42.01.034/2005-06 dated July 4, 2005

Finance Act 2005- Changes in Major

Head and Challans - OLTAS

17

RBI/2005/43

DGBA.GAD.No.H-76/42.01.001/2005-06 dated July 5, 2005

Levy of Banking Cash Transaction Tax on the Cash withdrawal by the Government Departments

18

RBI/2005/85

DGBA.GAD.No. H- 414/42.01.001/ 2005-06 dated July 30, 2005

Obligation of Schedule Banks to furnish information on Banking Cash Transaction Tax (BCTT).

19

RBI/2004/300

DGBA.GAD.NO.H.2532-65/42.01.034/ 2004-05 dated December 14, 2004

Compulsory Quoting of Permanent Account Number (PAN) / Tax Deduction Account Number (TAN) on Challans from 1/1/2005

20

DGBA.GAD.No.H-8649/42.01.034/2005-06 dated December 23, 2005

OLTAS-Software validations at banks

21

RBI/2006/295

DGBA.GAD.No.H.11140/42.01.034/2005-06 dated February 2, 2006

Online Tax Accounting System (OLTAS) - Sending daily scrolls by e-mail to ZAOs

22

DGBA.GAD.No.H-8294/42.01.037/2005-06 dated December 14, 2005

Online Tax Accounting System –

Drawing of Cheques by Assessees- Payee's Name

23

RBI/2006/55

DGBA.GAD.No.H-161/42.01.034/2005-06 dated July 7, 2006

OLTAS - Verification of PAN/TAN

24

RBI/2005/265

DGBA.GAD.No.H-8824/42.01.034/2005-06 dated December 28, 2005

Compulsory quoting of Permanent Account Number (PAN) / Tax Deduction Account Number (TAN)- State of Rajasthan

25

RBI/2006/150

DGBA.GAD.No.H-6226/42.01.011/2006-07 dated October 10, 2006

Permissible period of remittance of Government Revenues.


26

RBI/2007/235

DGBA.GAD.No.H-11763/42.01.011 /2006-07 dated January 24, 2007

Delay in Remittance of Government Receipts - Delayed Period Interest

27

RBI/2007/286

DGBA.GAD.No.13742/42.01.011/2006-07 dated March 13, 2007

Delay in Remittance of Government Receipts-Delayed Period Interest

28

DGBA.GAD.No.3774/42.01.034/2007-08 dated October 9, 2007

Discrepancies in Challan Details uploaded to TIN

29

RBI/2008/275

DGBA.GAD.No.10577/42.01.038/2007-08 dated April 3, 2008

Cut-off time for e-payment transactions pertaining to Government Revenue

30

RBI/2008/280

DGBA.GAD.No.H-10875 / 42.01.038/ 2007-08 dated April 10, 2008

Mandatory e-payment of tax by certain categories of taxpayers w.e.f. 01.04.2008

31

RBI/2008/321

DGBA.GAD.No.H-11895/42.01.038/ 2007-08 dated May 15,2008

Mandatory e-payment of direct taxes by corporate and assesses coming under Sec.44AB of IT Act

32

RBI/2008/328

DGBA.GAD.No.H-12070/42.01.034/ 2007-08 dated May 22, 2008

Improvement in data quality- Introduction of Computerised receipts w.e.f. June 1, 2008

33

DGBA.GAD.No.H.551/42.01.011/2008-09 dated July 18, 2008

Permissible Period of Remittance of E-payment of Government Transactions – Private Sector Banks

34

RBI/2008/09/97

DGBA.GAD.No.H. 549/42.01.011/2008-09 dated July 18, 2008

Permissible Period of Remittance of e-payment of Government Transactions – Public Sector Banks

35

RBI/2009/463

DGBA.GAD No.H-9284/42.01.011/2008-09 dated April 28, 2009

Recovery of Interest from Public Sector Banks on delayed remittances

of Government Receipts into Government Account

 



--
CA. V.M.V.SUBBA RAO
Chartered Accountant
Door No.24-2-1885,
I Floor, Flat No.5,
Siddivinayaka Residency, I Cross,
Central Avenue, MSR Nagar,
Magunta Layout,
Nellore-524 003
Andhra Pradesh
India
Mobile:+91 - 0 9390221100
           +91 - 0 9440278412
e-Mail: vmvsr@rediffmail.com
           vmvsr@yahoo.co.uk
http://pdicai.org/MyPage/203038.aspx

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