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

Sunrise Traders Pvt Ltd, a company that is not a Government entity, deducted tax at source for the first time in July. It had not applied for a tax deduction and collection account number before deducting. Under Rule 216 of the Income-tax Rules, 2026, by when must it apply, and in which Form?

The company must apply within thirty days from the end of the month of deduction, here July, in Form No. 135. Form No. 134 is reserved for Government entities, and a company is expressly excluded from that meaning under Rule 216.

  1. AWithin thirty days from the end of July, in Form No. 135Correct
  2. BWithin thirty days from the date of deduction, in Form No. 134
  3. CBefore 31st March of the financial year, in Form No. 135
  4. DWithin sixty days from the end of July, in Form No. 134

Explanation

Rule 216(4) requires the application prior to deduction, or if not so made, within thirty days from the end of the month in which tax was deducted. July deduction gives a deadline of 30 days from 31 July. A company is not a Government entity, so Form No. 135 applies. Form No. 134 is only for Government entities.

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