Tax deducted at source (TDS): While it is important to deduct a correct amount of TDS in certain transactions, it is also important to check the status of the deductee s PAN. If the TDS deductor does not check the status of PAN of the deductee on the date of TDS deduction then all the penalty and other legal repercussions would be applied to him and nobody else.
There are several tax deducted at source (TDS) provisions with different thresholds and multiple rates. This has created a TDS maze that leads to frequent disputes as well as the blocking of working capital at businesses.
The CBDT will soon come out with a circular for various stakeholders, especially banks, to "clarify" the procedures on the applicability of new TDS provisions regarding benefits or prerequisites received in a business or profession.