New Delhi, Jan 2
ONE of the two anti-tax evasion measures introduced by the Government through the Union Budget 2005-06 continues to be beset with implementation problems.
The Finance Ministry has once again extended the due date for filing of quarterly returns (by banks, co-operative societies, and certain public companies) of all deposits on which interest is paid without deduction of tax at source.
The Central Board of Direct Taxes (CBDT) has now extended the due date for the quarterly returns that was to be filed for the first quarter (April-June 2005) to January 31 this year.
The initial deadline for filing the return was July 31, but it was later extended twice to September 30 and December 31.
The Finance Ministry has also extended the due date for filing the quarterly returns for the July-September period to January 31 from the earlier extended deadline of December 31.
The Government had, through the Finance Act 2005, required banks and certain other entities to report on a quarterly basis all deposits on which interest has been paid to residents without deduction of tax.
The Finance Act 2005 mandates banks, co-operative societies, and certain public companies that are responsible for paying interest (interest other than interest on securities) not exceeding Rs 5,000 to a resident to prepare returns for the period ending on June 30, September 30, December 31, and March 31 in each financial year.
These quarterly returns are to be filed with the tax department on or before July 31, October 31, January 31, and June 30 following the respective quarter of the financial year.
Currently, the income tax law specifies that a bank would not be required to deduct tax at source in those cases where the interest (other than interest on securities) paid or credited by a branch to a person in a financial year does not exceed Rs 5,000.