Section-434: Refund for denying liability to deduct tax in certain cases

Section-434 : Refund for denying liability to deduct tax in certain cases

Section-434 seeks to provide for refund of tax deducted and paid to the Central Government by a person by whom the income is payable and who was required by an agreement to bear such tax deductible on the income on a claim made by him that no tax was required to be deducted on such income. Learn to understand the section-434 as it is, it's help and useful links to follow.

Here onwards, "Act" refers to "Income Tax Act 2025"

1. Section-434 as per act

Where,––
1. under an agreement or other arrangement, in writing, the tax deductible on any income, other than interest in section 393(2) (Table: Sl. No. 17), is to be borne by the person by whom the income is payable; and
2. such person having paid such tax to the credit of the Central Government claims that no tax was required to be deducted on such income, he may, within thirty days from the date of payment of such tax, file an application before the Assessing Officer for refund of such tax in such form and such manner, as prescribed.
The Assessing Officer shall, by an order in writing, allow or reject the application.
No application under sub-section (1) shall be rejected unless an opportunity of being heard has been given to the applicant.
The Assessing Officer may, before passing an order under sub-section (2), make such inquiry as he considers necessary.
The order under sub-section (2) shall be passed within six months from the end of the month in which application under sub-section (1) is received.