Circular No. 3/2011

Circular No. 03 /2011

What this is

Circular No. 3/2011 was issued by the Central Board of Direct Taxes on 13 May 2011. Its subject is Circular No. 03 /2011.

This is an order under section 119 of the 1961 Act — section 239 of the 2025 Act. Section 119 lets the Board give directions to its own officers and, in defined cases, relax a requirement. It is an administrative power, not a power to rewrite the charge.

What it does

Puts the quarterly deduction certificate on the department's own system. Under section 203 read with rule 31, Form No. 16 is issued annually for deduction under section 192 and Form No. 16A quarterly for deduction under any other provision of Chapter XVII-B, and until now only Form No. 16 could be authenticated by a digital signature. Because Form No. 16A was being prepared independently of the quarterly statement, its figures were drifting from those in Form No. 26AS, which is built from that statement. A facility on the Tax Information Network website now lets a deductor download Form No. 16A generated centrally from the figures in his own statement, with a unique certificate number, so both documents come from one source. Acting under section 119, the Board directs that for tax deducted on or after 1 April 2011 a deductor that is a company, including a banking company to which the Banking Regulation Act, 1949 applies, any bank or banking institution referred to in section 51 of that Act, or a co-operative society carrying on banking business, must issue Form No. 16A so generated and downloaded, for all sums deducted under any provision of Chapter XVII-B other than section 192; any other deductor may do so at his option.

Why it was issued

Representations were received to allow a digital signature on Form No. 16A, since signing a large number of certificates by hand was very time consuming, and the Board also wanted to close the gaps between Form No. 16A and Form No. 26AS, which arose mainly from wrong data entry by the deductor or from the quarterly statement not being filed at all.

Who it reaches

Companies, banks and banking co-operative societies deducting under Chapter XVII-B
Other deductors who may take the option
Deductees whose credit turns on the match between the certificate and the tax credit statement
Deductors facing mismatch complaints from payees

The provisions it speaks to

Left, the provision of the Income-tax Act, 1961 as the instrument itself names it. Right, the section of the Income-tax Act, 2025 that the department’s own concordance maps it to — which is where the same ground is now covered.

Under the 1961 Act	Now
s.51	s.81
s.119	s.239
s.192	s.392, s.402
s.203	s.395

The instrument, as the Board published it

The department publishes this one only as a PDF, so the words below were read out of that PDF by machine. That reading can carry its own mistakes — a misread number, a broken line. Check the signed document before you rely on a figure in it.

CIRCULAR NO. 03 /2011
F. No 275/34/2011-( IT-B)
Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
New Delhi, dated the 13th May, 2011
Subject: Issuance of TDS Certificates in Form No. 16A downloaded from TIN
Website and option to authenticate the same by way of digital
signature – Circular under section 119 of the Income-tax Act 1961.
Section 203 of the Income-tax Act 1961 ('the Act') read with the Rule 31 of
the Income-tax Rules 1962 ('the IT Rules') provides for furnishing of certificate of
tax deduction at source (TDS) by the deductor to the deductee specifying therein
the prescribed particulars like amount of TDS, permanent account number (PAN),
tax deduction and collection account number (TAN), etc. The relevant form for
such TDS certificate is Form No.16 in case of deduction under section 192 and
Form No.16A for deduction under any other provisions of Chapter XVII-B of the
Act. TDS certificate in Form No.16 is to be issued annually whereas TDS certificate
in Form No.16A is to be issued quarterly.

2. Currently, a deductor has an option to authenticate TDS certificate in Form
No.16 by using a digital signature. However, no such option of using a digital
signature is available to a deductor for issuing TDS certificate in Form No.16A and
it, therefore, needs to be authenticated by a manual signature. The Central Board
of Direct Taxes (the Board) has received representations to allow the option of
using digital signature for authentication of TDS certificate in Form No.16A as
issuance of TDS certificate in Form No.16A by manual signature is very time
consuming, specially for deductors who are required to issue a large number of
TDS certificates.
3. The Department has already enabled the online viewing of Form No.26AS
by deductees which contains TDS details of the deductee based on the TDS
statement (e-TDS statement)filed electronically by the deductor. Ideally, there
should not be any mismatch between the figures reported in TDS certificate in
Form No. 16A issued by the deductor and figures contained in Form No.26AS
which has been generated on the basis of e-TDS statement filed by the deductor.
However, it has been found that in some cases the figures contained in Form
No.26AS are different from the figures reported in Form No.16A. The gaps in Form
No.26AS and TDS certificate in Form No. 16A arise mainly on account of wrong
data entry by the deductor or non-filing of e-TDS statement by the deductor. As at
present, the activity of issuance of Form No.16A is distinct and independent of
Contd p-2
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filing of e-TDS statement, the chances of mismatch between TDS certificate in
Form No.16A and Form No.26AS cannot be completely ruled out. To overcome the
challenge of mismatch a common link has now been created between the TDS
certificate in Form No.16A and Form No.26AS through a facility in the Tax
Information Network website (TIN Website) which will enable a deductor to
download TDS certificate in Form No.16A from the TIN Website based on the
figures reported in e-TDS statement filed by him. As both Form No.16A and Form
No.26AS will be generated on the basis of figures reported by the deductor in the eTDS statement filed, the likelihood of mismatch between Form No.16A and Form
No.26AS will be completely eliminated.
4. In view of the above, for proper administration of the Act, the Board have,
in exercise of powers under section 119 of the Act, decided the following :-

4.1 ISSUE OF TDS CERTIFICATE IN FORM NO. 16A
(i) For deduction of tax at source made on or after 01/04/2011:
(a)The deductor, being a company including a banking company to which the
Banking Regulation Act,1949 applies and any bank or banking institution,
referred to in section 51 of that Act or a co-operative society engaged in
carrying the the business of banking, shall issue TDS certificate in Form
No.16A generated through TIN central system and which is downloaded
from the TIN Website with a unique TDS certificate number in respect of all
sums deducted on or after the 1st day of April, 2011 under any of the
provisions of Chapter-XVII-B other than section 192.
(b) The deductor, being a person other than the person referred to in item (a)
above, may, at his option, issue TDS Certificate in Form No.16A generated
through TIN central system and which is downloaded from the TIN Website
with a unique TDS certificate number in respect of all sums deducted on or
after the 1st day of April, 2011 under any provisions of Chapter-XVII-B
other than section 192.
(ii) For deduction of tax at source made during financial year 2010-11:
The deductor, may, at his option, issue the TDS certificate in Form No.16A
generated through TIN central system which is downloaded from the TIN
Website with a unique TDS certificate number in respect of all sums deducted
during the financial year 2010-11 under any of the provisions of ChapterXVII-B other than section 192.
Contd p-3
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4.2 AUTHENTICATION OF TDS CERTIFICATE IN FORM NO.16A
(i) The deductor, issuing the TDS certificate in Form No.16A by
downloading from the TIN Website shall authenticate such TDS
certificate by either using digital signature or manual signature
(ii) The deductor being a person other than a person referred to in item
4.1(i)(a) above and who do not issue the TDS Certificate in Form No.16A
by downloading from the TIN Website shall continue to authenticate
TDS certificate in From No.16A by manual signature only.
5. The Director General of Income-tax (Systems) shall specify the procedure,
formats and standards for the purpose of issuance of TDS certificate in Form
No.16A which is downloaded from the TIN Website and shall be responsible for the
day-to-day administration in relation to the procedure, formats and standards for
issuance of TDS certificate in Form No.16A in electronic form.
6. It is further clarified that TDS certificate issued in Form No. 16A by the
deductors covered by para 4.1(1)(a) in accordance with this circular and
procedure, format and standards specified by the Director General of Income-tax
(Systems) shall only be treated as a vilid TDS certificate in Form No. 16A for the
purpose of section 203 of the Act read with Rule 31 of the IT Rules,1962.
7. Hindi version shall follow.
(AJAY KUMAR)
Director (Budget)
Tel.No.2309-2641
Copy to all CCsIT/ DsGIT for circulation

What to watch

The obligation is mandatory for companies, banks and banking co-operative societies and only optional for everyone else, so a payee's expectation of a downloaded certificate depends on who the deductor is.
Because the downloaded certificate is generated from the quarterly statement, a deductor who has not filed or has filed wrong particulars cannot issue a correct certificate - fixing the statement is the only route.
The direction covers deduction on or after 1 April 2011 and every provision of Chapter XVII-B except section 192, which keeps its own annual certificate.
The copy before me is clipped at 5,000 characters in the middle of the optional limb, so the rest of the directions, including on digital signature and on the deductee's position, must be read from the published circular.

Where you meet it

Where credit for tax deducted is refused because the certificate does not match Form No. 26AS, or where a deductee asks for a certificate carrying a unique certificate number.

What it names

Forms it names. Form No. 16, Form No. 16A, Form No. 26AS

Rules it names. Rule 31 of the Income-tax Rules, 1962. The 1962 Rules were replaced by the Income-tax Rules, 2026, which renumbered nearly everything: a rule number quoted here almost never means the same rule today.

It mentions. Circular No. 03/2011

On the same provision

Other instruments in this library that name the same provision of the 1961 Act. They are not necessarily still operative, and a later one may have replaced an earlier one without saying so.

Notification No. 53/2022 [F.No. 370142/49/2020-TPL] / GSR 346(E) — Ministry of Finance 10 May 2022
F.No. 275/192/2018-IT (B) — Income-Tax Deduction from Salaries during the Financial Year 2018-19 under Section 192 of the Income-tax Act, 1961 8 February 2019
Notification No. 104/2016 [F.No.370142/32/2016 -TPL] / SO 1068(E) — [To BE Published in the Gazette of INDIA, Extraordinary, Part II, section 3, Sub-section (i)] 15 November 2016
Circular 13/2015 — Circular No. 13 of 2015 6 July 2015
Notification No. 182 — Rules/amendment Rules 11 July 2005
Notification No. 288 — Amendment of the Income-tax Rules under section 3 of the Income-tax Act, 1961 1 December 2004

A circular binds the department, not you and not a court. The Board issues a circular to its own officers. An assessee may hold the department to a circular that helps him; the department cannot hold an assessee to one that hurts him, and the Tribunal and the courts decide the law for themselves.

Source: the Income Tax Department’s own published text — its page for this instrument.