Wednesday, June 20, 2012

Indemnity Bond for IT Refund


Why do we pay Income Tax ? This can be debated for ever and we are not going to discuss that today. Assuming that the hard earned money of the tax payers are put to good use by the government which is yet again debatable, my first concern is that when I pay my taxes on time, I MUST get my IT refund as promptly too. When the common man is subjected to TDS (Tax deducted at source), the least one can expect is that the IT department does not sit on the refund for long. There has to be a realistic timeline not running in years and decades by when the government MUST refund any amount receivable by the taxpayer. Unfortunately though there is a theoretical timeline for refunds, there are always umpteen reasons for the ITO to delay an IT Refund. The refund process has seen a marked improvement over the years but there are still areas of improvement.

I have seen that IT returns filed online get processed faster and hence the refunds. There is also a tool available to check your IT refund status online  Online Income Tax Refund Status

Sometimes you will see a message stating that 
  1. Your assessing officer has not sent this refund to Refund Banker.
  2. If this refund has been sent by your Assessing Officer within the last week, you may wait for a week and again check status.
It will take some time until we have a system where the refund related information is updated faster.

If you returns are older then 2-3 years then upon inquiry you may be asked by the Income Tax Department to submit an Indemnity Bond addressed to the President of India which basically states that you confirm that you have not received that particular IT refund order and that you will be responsible in case excess or duplicate refund is issued to you. This is a standard process and it is fine to provide the Income Tax department with an Indemnity Bond if inquired. Take a printout of the following template on a Rs 200 Non Judicial Stamp Paper and get it notarized. In Bangalore, you can get one done in Koramangla BDA Complex.

Indemnity Bond for Income Tax Refund Template

In some cases where the IT refund has returned back either due to change in address or non availability of the person then you can write a letter to Central Processing Cell, Bangalore with your details and request them to remit the refund amount to your Savings Bank account. You will need to enclose a cancelled cheque of your savings account #. Please refer to the following template

Letter to CPC regarding return of Refund Cheque

I hope the information on this post helps you get your Income Tax Refund on time.

Monday, June 18, 2012

How to apply for PAN Online ?


PAN Card is a very vital piece of document which identifies you as a Tax Payer in India. You may need to apply for or request for updating your personal details associated with your PAN Card from time to time for any one or more of the following reasons:

1. You do not have a PAN Card and want to apply for one.

2. You have relocated to a different city and hence your residential address has changed. It is important to have your PAN card updated with your current address because any IT refund sent via cheque is always sent to the address updated against the PAN unless you submit an Indemnity Bond.

3. You lost your PAN card and want to have a duplicate reissued.

4. Your PAN card is damaged and you want to have a new one reprinted.



You will be pleasantly surprised to know that you can do all this online now. Visit the following site: Application for PAN through Online Services

You can make your payment for the new PAN card / correction in PAN data online via Net banking or Credit card. The fees for a new card or updates is  96.00

Please read through the guidelines and instructions very carefully. The acknowledgement duly signed, affixed with photograph (in case of 'Individuals') along with demand draft/cheque, if any, proof of existing PAN, proof of identity & address as specified in the application along with any other relevant proof as specified (in Item No.IV - Documents to be submitted along with the application ) is to be sent to NSDL at 'National Securities Depository Limited, 3rd floor, Sapphire Chambers, Near Baner Telephone Exchange, Baner, Pune - 411045'.

1. Super scribe the envelope with 'APPLICATION FOR PAN CHANGE REQUEST-Acknowledgment Number' (e.g. 'APPLICATION FOR PAN CHANGE REQUEST-881010200000097').

2. Your acknowledgement, demand draft/cheque, if any, and proofs, should reach NSDL within 15 days from the date of online application.

3. Applications received with demand draft or cheque as mode of payment shall be processed only on receipt of relevant proofs and realisation of payment.

4. Applications received with credit card / debit card / net banking as mode of payment shall be processed on receipt of relevant documents (acknowledgement and proofs).

Once your supporting documents reach the NSDL office, you should receive your new or updated PAN Card at your residential address.

I hope this information was helpful.



Wednesday, June 13, 2012

How to renew your Passport ?


Way back in 2003 and before you had to stand in a Big queue to submit your passport application and there were high chances that you would be sent back upon reaching the counter for some silly mistake in the application form. This was not all; after you submitted your application it could take anywhere from 3-6 months for you to finally receive your passport.

Regardless of what the current GDP or the state of economy is today, I can say with pride that we have done a much better job in issuing passport in the last decade.

Thanks to Shri SM Krishna, Minister of External Affairs, the pilot project for Online Passport Seva was launched in Bangalore and Chandigarh in May 2010 and August 2010 respectively. Today the Passport Seva Project has been launched in most major cities of the country.

I got my passport re-issued in Bangalore and my passport was delivered to me on the 11th day after submitting my application in the PSK, Sai Arcade under the "Normal" category without having to pay a single penny as bribe. With so much of negativity with the system around these days, I believe it will only be fair to share good experiences if that can boast the morale of people in the system who are doing their job really well. Go to http://passportindia.gov.in and register yourself as a user. After a successful registration, login to complete your online passport application.


The online application is very self explanatory and easy to complete. The online portal gives you the flexibility of saving and completing your form in multiple sittings either offline or online.  You can review your filled in form for correctness. After you submit your application you will receive your online generated Application Reference Number (ARN Number). 
Please remember the following important points:
1. Your ARN or submitted application will be valid for 90 days from the date of submission after which it will be deleted from the database. You have 90 days to complete your passport application process.

2. The second stage after submitting your online application is taking an online appointment at your nearest PSK which we will discuss a little later in this blog.

3. You will be able to apply under the category "Validity Expired Within 3 Years/Due To Expire" only when you are within the one year window from the Date of Expiry on your passport. My passport was due for expiry in 2013, but I wanted to have it renewed without having to wait till the last moment. Since I was outside that one year window from my passport expiry, I applied under the "Change In Existing Personal Particulars" category to have my wife's details added.

4. Every time a new passport is issued on your name, it will have a new passport number with a reference to your old passport on its last page. Additionally the new passport will have a new expiration (10 years) from the date it is issued.
5. Your old passport is cancelled and returned back to you when you submit your documents at the PSK (Passport Seva Kendra).

6. Any Valid Visa stamped on your old passport will still valid after your old passport is cancelled but you will have to travel with both your old and new passports together. So be prepared to wait until you receive your new passport if you have any immediate travel plans.

Online Application for Issue / reissue of Passport under Normal Category:

Taking an online appointment after submitting your online application is still a pain. Appointments open at specific times of the day in various cities (In Bangalore the online appointments open at 6 PM every day) and get over in no time. People keep sitting in front of their computers trying to book a slot. Sometimes they have to try for days. I had to sit for 45 minutes clicking on "Book My appointment" when I finally got one. I read on many forums that agents/brokers charge anywhere from Rs 800 - Rs 1500 to book an online appointment on your behalf. Since online booking is a very transparent process, I wonder how an agent / broker can get an appointment when you cannot. Such an infringement is not possible without the help of a hacker who is exploiting the site and helping the brokers mint money at the expense of innocent people. I hope this will be fixed soon. However I would recommend the readers of this blog to discourage going through agents to book appointment slots. Have some patience and try booking your online appointments yourself for a couple of days. If you still fail to get an appointment, please read the following alternative procedure of getting an online appointment: Advisory for Applicants You can go to the RPO and take an appointment through them. I understand you want your passport in no time. Let that not be an excuse to pay agents/brokers money for things you can do yourself. You might as well donate that money on some NGOs or Non profit making institutions on Satyamev Jayate

On the Day of Apppointment:

Reach the PSK an hour in advance. You are not called in sequence of your ARN number so whoever reaches first stands before the others in the queue outside the PSK. They however let everyone for a given slot get inside the PSK. Phones with cameras are not allowed. There is a front desk manned by TCS employees who do the initial check for all your documents. I understand that it is important to complete the process once you reach the PSK but for some reason if any of your document is missing, there is no point getting angry. Try arranging for the document(/s) and coming back the same day if you can, else take an appointment for the next available day. Always have your documentation clean and clear. Remember every individual has a right to have a passport and these documents that you are required to submit are to safeguard your own interests. If you do not have a certain document, make an inquiry at the front desk people and ask for alternatives.

Once you have the initial verification done, you will get an appointment number (N463,T128,etc.) With this appointment number enter with your file and documents into an air conditioned waiting launge where you need to go through three counters sequentially A-->B-->C for verification and submission. There are big screens in the waiting lounge where you can see when your number is called for a specific counter.

At Counters B, VO (Verification Officer), your documents are verified by Government Officials from where if your documents are clean, you are redirected to Counter C GO (Granting Officer) for the granting of passport.

At Counter A, manned by TCS officials, your documents are scanned. The official takes your photograph (this means you do not need to carry passport size photographs) along with your fingerprints. If there are any corrections in the Application form which you may have realized after form submission, you can have the changes updated here.
 
At Counter C GO (Granting Officer), the final decision on your passport application is taken. If you have cleared Counter A and Counter B then it is almost certain that passport will be granted to you. Another important decision that is taken by GO is whether your qualify for Pre, Post or No police verification. Mine was a reissue case with change in address so I qualified as a post verification.There are 3 modes of police verification: 

    Police Verification is not required.
    Police Verification is required on a Post-Passport Issuance basis.
    Police Verification is required on Pre-Passport Issuance basis.


Depending on whether an application is for issue of fresh passport or reissue of passport, Passport Office (PO) shall decide whether Police Verification is required for issuance of Passport to you. In most cases, of issue of fresh passport, pre-police verification would be required, exception being Government servants on submission of 'Identity Certificate' as per Annexure 'B', or minors whose parent(s) hold valid passport etc. In most cases of reissue, depending on records available in the Passport Office system, police verification would not be required or only post police verification would be required, exceptions being reissue of passport in lieu of lost passport or complete change of name.

The screens in the waiting lounge are programmed to flash appointment numbers and you cannot bypass them so there is no point queuing up in front of the counters. After you done with say Counter A, please come back to the waiting lounge and wait for your appointment number to flash on the screen for the next stage. There are arrangements for refreshment with a well maintained restroom. Tea, coffee and snacks are available at MRP and you can be very comfortable when you are inside. The entire process should normally take about 2-3 hours. It would be a good idea to take leave on that day from work and be patient when you are inside the PSK. Once you are at counter C and the passport is granted to you, please remember to collect an acknowledgement at the exit. If you have applied for a reissue of passport, your old passport will be cancelled by the GO (Granting Officer) at Counter C and returned back to you.

I got an SMS and an email with the Speed Post Number when my passport was dispatched. I planned to work from home the very next morning and at 11 AM sharp I got my passport delivered. Passport delivery normally happens in the first half of the day between 9 AM to 12 noon. My Police Verification also completed in a weeks time after I received my passport.

Say no to bribe and follow the process with a little bit of patience and you will come out clean and confident on the other side with your job well done.


I hope this post was useful to you.


Important Links:






How to Surrender an LIC Policy ?

In the era of online affordable term plans, I am sure most of us would be evaluating our existing LIC endowment/money back policies to ensure that they meet our current insurance needs. After a careful examination of your insurance needs, should you feel the need to surrender your LIC policy, your first step should be to find out relevant information from the LIC India official website http://www.licindia.in/. However very soon you will realize that the information you are looking for is not present on the website. As of today, I have not been able to find any information on how to surrender an LIC policy on the LIC portal. The Downloads section has everything but the Policy Surrender Forms. Currently LIC does not have any facility to surrender an LIC Policy online. Here is what you can do to surrender your policy:

Visit the nearest LIC Branch in your region LIC Branch Locator and collect the following three forms:


(You can alternately also download a copy from my post and use a printout of the same)

The forms are self explanatory. Fill up all the forms. It is a good practice to attach a covering letter mentioning your policy details and a list of all the documents you are submitting. You may use the following sample letter: LIC_Surrender_Request_Letter

Please remember to provide your Bank Account information in the NEFT Mandate form. This will facilitate LIC to credit the surrender value (if any) into your Savings Bank Account via NEFT. You also need to enclose a cancelled cheque (Do not strike on the Account Number of Branch Address on the cheque). In case your Cheque Book does not have your name, enclose a copy of the first page of your passbook (This will indicate that that you are the rightful owner of that Savings Account).

Once you have all these documents ready, you need to send them along with your Original Policy Certificate to the Branch where you hold your LIC Policy. It is not important for you to submit these documents personally. All you need is a reliable courier service that could deliver the documents at the right place. This is important because you would be sending your Original Policy Document along with it. You can also submit these documents through your LIC Agent if you are remotely located.

I hope that you found this information helpful.

Please note: This post does not aim at urging people to surrender their LIC Policies. This only documents the procedure of doing so, should you ever feel the need, depending on your financial situation.