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CA Final · Direct Tax Laws & International Taxation · Deduction, Collection and Recovery of Tax

Sunrise Foods Ltd failed to deduct tax on a payment to a resident and obtained a certificate from an accountant that the payee had paid the tax. Under Rule 221 of the Income-tax Rules, 2026, which statement is correct about the certificate and to whom is it furnished?

The accountant's certificate for non-deduction or short deduction is in Form No. 149, and it is furnished to the Director General of Income-tax (Systems) or the person authorised by him. Form No. 150 is meant for non-collection or short collection of tax.

  1. AForm No. 149 for non-deduction or short deduction, furnished to the Director General of Income-tax (Systems) or the person authorised by himCorrect
  2. BForm No. 150 for non-deduction or short deduction, furnished to the Assessing Officer
  3. CForm No. 149 for non-collection or short collection, furnished to the Assessing Officer
  4. DForm No. 150 for non-deduction or short deduction, furnished to the Director General of Income-tax (Systems)

Explanation

Rule 221(1)(a) prescribes Form No. 149 for non-deduction or short deduction, and Form 150 for non-collection or short collection. Rule 221(2) requires furnishing to the Director General of Income-tax (Systems) or the person authorised by him, so the options naming the Assessing Officer or Form 150 are wrong.

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