TCS intimation to be deemed as demand notice

Current Provisions
When any tax, interest, penalty, fine or any other sum is payable in consequence of any order passed under this Act, the Assessing Officer shall serve upon the assessee a notice of demand in the prescribed form specifying the sum so payable.

Provided that where any sum is determined to be payable by the assessee or by the deductor under sub-section (1) of section 143 or sub section (1) of section 200A, the intimation under those sub-sections shall be deemed to be a notice of demand for the purposes of this section.

II. Proposed Amendment
The Finance Bill, 2015 proposes to insert a new section 206CB relating to processing of statements of tax collected at source.

The existing provisions contained in the Income-tax Act provide the method of processing of statements of TDS. Since there was no procedure specified with respect to the processing of TCS, it is proposed to insert a new section 206CB relating to processing of statements of TCS and the said section provide that statement of TCS or a correction statement made under section 206C shall be processed in the manner specified therein.

Consequently, it is proposed through amendment in Sec. 156 that where any sum is determined to be payable by the assessee or the deductor or the collector under sub-section (1) of section 143 or sub-section (1) of section 200A or sub-section (1) of section 206CB, the intimation under those sub-sections shall be deemed to be a notice of demand for the purposes of this section.

III. Conclusion
As new section 206CB proposed to be inserted with effect from 1st June, 2015 has reference to tax collected at source which has to go hand in hand with tax deducted at source, amendment to section 156 incorporating the word "collector" and further reference to sub-section (1) of section 206CB is consequential.
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