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TMI BlogProcedure for refund of tax deducted at source under section 195 to the person deducting the tax - section 239 of the Income Tax 1961 - RefundsX X X X Extracts X X X X X X X X Extracts X X X X ..... ng that the said Circular may be amended to take into account situations where genuine claim for refund arises to the person deducting the tax at source from payment to the non-resident and it does not fall in the purview of the said Circular. 2. The cases which are being referred to the Board mainly relate to circumstances where, after the deposit into Government account of the tax deducted at source under section 195, a ) the contract is cancelled and no remittance is made to the non-resident; b ) the remittance is duly made to the non-resident, but the contract is cancelled. In such cases, the remitted amount has been returned to the person responsible for deducting tax at source; c ) the contract is cancelled after partial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... claim being made by the non-resident with whom the transaction was intended or in terms of Circular No. 790 dated 20th April, 2000. 3. In the type of cases referred to in sub-paragraph ( a ) of paragraph 2, the non-resident not having received any payment would not apply for a refund. For cases covered by sub-paragraph ( b ) to ( i ) of paragraph 2, no claim may be made by the non-resident where he has no further dealings with the resident deductor of tax or the tax is to be borne by the resident deductor. This resident deductor is therefore put to genuine hardship as he would not be able to recover the amount deducted and deposited as tax. 4. The matter has been considered by the Board. In the type of cases referred to above, where no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... each of the direct taxes should be prepared by the Income-tax Officer or the Assessing Officer in favour of the "Income-tax Department" and sent to the bank along with the challan of the appropriate type. The amount adjusted and the balance, if any, refunded would be debitable under the major head "020-Corporation Tax" or the major head "021-Taxes on incomes other than Corporation tax" depending upon whether the payment was originally credited to the major head "020-Corporation tax" or to the major head "021-Taxes on Income other than Corporation tax". 7. A refund in terms of this circular should be granted only after obtaining an undertaking that no certificate under section 203 of the Income-tax Act has been issued to the non-resident. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 769 dated 6th August, 1998, there was no time limit for making a claim for refund. A time limit of two years, for making a refund claim, was stipulated vide Circular No. 790 dated 20th April, 2000. Some cases covered by Circular No. 769, which were also covered by Circular No. 790, now listed in item ( a ) and ( b ) of paragraph 2 of this Circular, and filed before the issue of Circular No. 790, became time-barred because of the specification of time limit in Circular No. 790. It is hereby clarified that such cases may also be considered for refund. 11. This Circular is issued in supersession of the Circular No.790/2000 dated 20th April, 2000. 12. The contents of this Circular may be brought to the notice of all officers in your regi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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