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TMI BlogMaster Circular - Collection of Direct Taxes - OLTAS - RBIX X X X Extracts X X X X X X X X Extracts X X X X ..... . 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. Major Heads of Account 3. 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 associa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 Dir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ove. 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 insofar 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 leas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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, only 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 cor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... irect 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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/2005/8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ery 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 per cent 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. Accounting Procedure relating to crediting of CBDT collections to Govt. Account - Private Sector Agency Banks 18. 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 per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 CA 206C Collection at source from Timber obtained under Forest lease 6 CB 206C Collection at source from Timber obtained by any Mode other than a Forest Lease 6 CC 206C Collection at source from any other Forest Produce (not being Tendu Leaves) 6 CD 206C Collection at source from Scrap 6 CE 206C Collection at source from contractors or licensee or lease relating to Parking lots 6CF 206C Collection at source from contractors or licensee or lease relating to Toll Plaza 6CG 206C Collection at source from contractors or licensee or lease relating to mine or quarry 6 CH 206C Collection at source from Tendu leaves 6 CI CHALLAN NO. 282 This challan is for the payment of a number of taxes. The changes introduced in this challan ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns 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 taxpayers, 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 taxpayers 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 Nos. 280 281 with pre-printed PAN/TAN number may also be given wide publicity through your designated branches. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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, Jhandewalan Extension, New Delhi 110 055 Banks may download the above Notification and forms from the website www.taxmann.com. 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 shou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r 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 and branch, the BSR code the branch (7 digits), date of deposit (DD/MM/YY) 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 wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ization 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 : DD/MM/YY (in the rubber stamp acknowledgement) (ii) Date of realization: DD/MM/YY (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 ser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 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 branches 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 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll 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 t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re 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 Transacti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ual 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. Overview 1. 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. Functionality 2. When you open the SPECIAL FVU.exe file a utility will be seen as below. The utility conta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 file names 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) This block (shown above) will be repeated for as many times as no. of tax heads are available. NOTES : (1) The record for one receiving branch should be contained in o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AMOUNT and NO. OF CHALLANS are numeric values. Master Circular - Index Sr. No. Reference No. Subject 1. DGBA.GAD.No.H-684/42.01.001/ 03-04, dated 9-01-2004. 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, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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