Major Relief for Taxpayers: CBDT Waives Interest on TDS/TCS Delays due to Technical Glitches [Read Circular]
CBDT, via Circular, allows interest waiver on TDS/TCS payment delays caused by technical glitches, offering major relief to taxpayers
![Major Relief for Taxpayers: CBDT Waives Interest on TDS/TCS Delays due to Technical Glitches [Read Circular]](https://www.taxscan.in/wp-content/uploads/2025/03/CBDT-CBDT-waives-interest-on-TDS-delays-TDS-taxscan.jpg "Major Relief for Taxpayers: CBDT Waives Interest on TDS/TCS Delays due to Technical Glitches [Read Circular]")
The Ministry of Finance, through the Central Board of Direct Taxes (CBDT) issued Circular No. 5/2025 dated March 28, 2025, announcing that interest charges under sections 201(1A)(ii) and 206C(7) of the Income Tax Act, 1961 can now be waived in cases where delays in TDS or TCS payments were caused due to technical glitches. According to the circular, if the taxpayer initiated the payment...
The Ministry of Finance, through the Central Board of Direct Taxes (CBDT) issued Circular No. 5/2025 dated March 28, 2025, announcing that interest charges under sections 201(1A)(ii) and 206C(7) of the Income Tax Act, 1961 can now be waived in cases where delays in TDS or TCS payments were caused due to technical glitches.
According to the circular, if the taxpayer initiated the payment and funds were debited from their bank account on or before the due date, but the credit to the Central Government was delayed solely due to technical reasons, interest levied for such delay may be reduced or waived.
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The decision-making authority for granting this relief lies with the Chief Commissioner of Income-tax (CCIT), Director General of Income-tax (DGIT), or Principal Chief Commissioner of Income-tax (PrCCIT). These officials will assess waiver applications and pass a speaking order after:
- Giving the applicant an opportunity to be heard, and
- Verifying the technical issue from the bank or the Directorate of Systems.
The circular further clarifies that even if the interest has already been paid, the taxpayer may still apply for a waiver and may receive a refund if approved. However, such applications must be submitted within one year from the end of the financial year in which the interest was charged. Authorities are directed to dispose of applications within six months from the month of receipt.
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Importantly, the order passed by the CCIT/DGIT/PrCCIT will be final, and no further appeal will lie before the Board.
The circular, which comes into immediate effect.
To Read the full text of the Circular CLICK HERE
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