CBDTVV circular no. 6/2024: relief for tds deductors on pan-aadhar linkage

The CBDT, aiming to address grievances of deductors/collectors who collected TDS/TCS at the normal rate but were required to deduct/collect at double the rate due to the deductee’s PAN being inoperative (unlinked with Aadhar) since April 1, 2023, issued Circular No. 6 on April 23, 2024.

This circular prevents treating such TDS deductors as in default (for short deduction) if, by May 31, 2024, the deductee’s PAN is linked to Aadhar, rendering it operative for transactions until March 31, 2024.

Consequently, no liability arises for deductors/collectors to deduct/collect tax under sections 206AA/206CC at double the rate due to PAN inoperability, and they need not pay the difference. Recently, many notices have been issued to deductors for shortfalls in tax deduction because the deductee’s PAN was found inoperative.

Source : https://incometaxindia.gov.in/Pages/communications/notifications.aspx