Section 205 of ITA, 1961 : Section 205: Bar Against Direct Demand On Assessee

Explanation using Example

Imagine Mr. Sharma receives a monthly salary from his employer. According to the Income-tax Act, his employer deducts tax at source (TDS) from his salary each month. This deducted amount is then deposited with the government by the employer on behalf of Mr. Sharma. Now, when Mr. Sharma goes to file his annual income tax return, he will not have to pay any income tax on his salary income up to the extent of the TDS already deducted by his employer, because Section 205 of the Income-tax Act, 1961, ensures that he is not required to pay tax on income where tax has already been deducted at the source.