Monthly Deductions from Salary A/c for PF Contributions not eligible for exemption under 80(c) of IT Act

Q & A Forum › Category: Provident Fund (EPF & PPF) › Monthly Deductions from Salary A/c for PF Contributions not eligible for exemption under 80(c) of IT Act

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rkkund asked 9 years ago

My Employer had deducted monthly NPS contributions last financial year. However, the organisation failed to deposit d same due to non-availability of PRAN. Organisation's auditors have made objection that the amount was not deposited in PF A/c nd lying in Sundry the same is not eligible for IT exemptions under 80(c). Kindly clarify

2 Answers

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Sreekanth Staff answered 9 years ago

Hi, If the amount has been deducted but not deposited then one can not claim tax deductions. It can be a failure on your employer part. May I know what is non-availability of PRAN? (Is that due to your mistake or employer's?)

rkkund replied 9 years ago

PRAN number is Permanent Retirement Account Number. It is a unique number which is essential for identifying the depositor. The PRAN number came into existence after the Central Government has introduced the NPS( New Pension System) with effect from 1st January, 2004. The National Pension Scheme has made this account number compulsory for all Central Government employees who has joined service on or after 1st January, 2004. Central government employees joining service on or after 1st January, 2004 get automatically enrolled for the National Pension System.It alloted by NSDL. Till date it has not been alloted to me. Hence, the employer is deducting monthly contributions but is not able to deposit the NPS contributions. It is neither my mistake nor my employer’s, then why i should suffer???

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Sreekanth Staff answered 9 years ago

Hi, I am aware of what is PRAN.. As you are a central Govt employee, your employer also mandatorily contributes to NPS, so what about their contributions? I believe that this is a serious mistake from your employer-side only. They only have to guide and let you know the resolution.