Login to e-Filing website with User ID, Password, Date of Birth /Date of Incorporation and Captcha.

ii.

Go to E-file menu and click on "Response to Outstanding Tax Demand".

iii.

Following details would be displayed.

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Assessment Year

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Section Code

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Demand Identification Number (DIN)

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Date on which demand is raised

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Outstanding demand amount

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Uploaded By

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Rectification Rights

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Response- Submit and View

iv.

Taxpayer must click on "Submit" link under Response column for the respective AY in order to submit the response. Taxpayer has to select one of the options from the radio button.

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Demand is correct

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Demand is partially correct

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Disagree with demand

v.

If taxpayer selects "Demand is correct", then a pop up is displayed as "If you confirm "Demand is correct' then you cannot 'Disagree with the demand'. (Click on "Submit". A success message is displayed.

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If any refund is due, the outstanding demand along with interest will be adjusted against the refund due.

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In any other case taxpayer has to immediately pay the demand.

vi.

It taxpayer selects "Demand is partially correct", then "Amount which is correct" and "Amount which is incorrect" has to entered.

vii.

If taxpayer selects 'amount which is incorrect' then he should mandatorily fill one or more reasons for stating so as listed below:

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Demand has been already Paid—

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Demand paid and Challan has CIN (Challan Identification Number )

•

Demand paid and Challan has no CIN

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Demand has already been reduced by rectification/revision

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Demand has already been reduced by Appellate Order but appeal effect has to be given by Department

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Appeal has been filed and

•

Stay petition has been filed with

•

Stay has been granted by

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Instalment has been granted by

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Rectification / Revised Return has been filed at CPC

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Rectification has been filed with Assessing Officer

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Others

viii.

Based on the reasons selected, the taxpayer needs to provide additional information as per the table given below.

Reason Selected

Additional Details Required

Demand paid and Challan has CIN

BSR Code

Date of payment

Serial Number of challan

Amount

Remarks (any comments of taxpayer can be included)

Demand paid and Challan has no CIN

Date of payment

Amount

Remarks (any comments of taxpayer can be included)

Upload copy of Challan

Demand already reduced by rectification / Revision

Date of Order

Demand after rectification/ revision

Details of AO who has rectified or revised

Upload Rectification / Giving appeal effect order passed by AO

Demand already reduced by Appellate Order but appeal effect to be given

Date of Order

Appellate Order passed by (details of CIT(A) etc)

Reference Number of Order

Appeal has been filed: Stay petition has been filed

Date of filing of appeal

Appeal Pending with (derails of CIT (A) etc)

Stay petition filed with (details of office etc)

Appeal has been filed: Stay has been granted

Date of filing of appeal

Appeal Pending with

Stay granted by

Upload copy of Stay Order

Appeal has been filed Instalment has been granted

Date of filing of appeal

Appeal Pending with (details of CIT (A) etc)

Instalment granted by (details of office etc)

Upload copy of stay/instalment order

Rectification / Revised Return filed at CPC

Filing Type

e-Filed Acknowledgement No.

Remarks (any comments of taxpayer can be included)

Upload Challan Copy

Upload TDS Certificate

Upload Letter requesting rectification copy

Upload Indemnity Bond

Rectification filed with AO

 Date of application

Remarks (any comments of taxpayer can be included)

Other Reasons

Others (any comments of taxpayer can be included)

ix.

If taxpayer selects "Disagree with the Demand", then taxpayer must furnish the details of disagreement along with reasons. Details / Reasons are same as provided under "Demand is partially correct".

x.

After the taxpayer submits the response the success screen would be displayed along with the Transaction ID.

xi.

The taxpayers can click on 'View' link under Response column to view the response submitted. The following details are displayed:

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Serial Number

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Transaction ID

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Date of Response

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Response Type

Taxpayer has furnished information in response to notice u/s 245 of the Act; or

(b)

Taxpayer has requested for reduction/removal of demand; or

(c)

Information regarding demand reduction/removal is available in Department Records; or

(d)

Details are already available in the system, such as additional TDS credits reported by Deductor in case of earlier TDS mismatch.

If the taxpayer's reply or Departmental records show that demand or tax has already been paid and challan (challan identification number (CIN)) is available on the system:

i.

The AO should reduce the demand by posting the challan or passing rectification order u/s 154 on the system.

ii.

If the demand is prior to 01/04/2010, the demand has to be reduced directly on the CPC-FAS system.

(b)

If CIN is not available or payment is made prior to the period of introduction of CIN, the reduction can be made only in case of individuals and HUFs provided outstanding demand does not exceed Rs.1,00,000 for that AY. The AO should follow the steps as under:

i.

The reduction can be made after obtaining of the document showing evidence of payment in form of taxpayer counterfoil or bank certificate or any communication from Department in respect of payment or adjustment of refund. In case where taxpayer is a senior citizen and taxpayer is not able to obtain bank certificate as the place of payment of tax is different from the current place of taxpayer, the AO should obtain the certificate from the bank directly.

ii.

In case the outstanding demand is more than Rs. 25000/- for that AY irrespective of the quantum of demand being reduced under paragraph 4.1.(b).i. above, the AO should obtain an indemnity bond (in the format given in ANNEXURE A) from the taxpayer.

iii.

Additionally, in case the demand being reduced under paragraph 4.1.(b).i. above exceeds Rs.50,000/- for that AY for the assessee, besides obtaining the indemnity bond, approval of Range Head should be taken on file before removing/reducing the demand.

iv.

if the payment relates to mismatch of advance tax or self assessment tax, order u/s 154 of the Act needs to be passed.

If the taxpayer's reply or Departmental records show that the demand is on account of TDS mismatch and TDS credits are available in the system, the AO should follow steps as under:

i.

The AO should reduce the demand by passing rectification order u/s 154 on the system after taking into account the TDS credits available on the system.

ii.

If the demand is prior to 01/04/2010, the demand has to be reduced directly on the CPC-FAS system after rectification u/s 154.

(b)

If the credits are not available in 26AS: The reduction can be done only in the cases of Individuals and HUFs. Further, the amount of reduction should not exceed Rs. 1,00,000/- for that AY and AO should take following steps:

i.

AO should pass order u/s 154 manually after obtaining the TDS certificate from the assessee on the basis of which claim has been made.

ii.

In case, the outstanding demand is more than Rs.25,000 for that AY, irrespective of the quantum of demand being reduced, the AO should obtain an indemnity bond (in the format given inAnnexure A)

iii.

Additionally, in case the demand being reduced under paragraph 4.2.(b).i above, exceeds Rs.50,000/- for that AY for the assessee, besides obtaining the indemnity bond, approval of Range Head should be taken or file before removing/reducing the demand.

If the taxpayer's reply or Departmental records show that demand has already been reduced by way of an order (rectification order, appeal effect order etc.), the demand has to be reduced directly on the CPC-FAS system.

(b)

In case where rectification or giving effect order to reduce demand is pending, the same should be completed and revised demand should be reflected.

(c)

It is also clarified that after taking action as per para 4.1 or 4.2, if any refund becomes due to the taxpayer, the same may also be issued.