As a part of automation of collection, compilation and processing of TDS/TCS returns ITD has notified an "Electronic Filing of Returns of Tax Deducted at Source Scheme, 2003". It is applicable to all deductors furnishing their TDS return in electronic form.

• It is mandatory (w.e.f. June 1, 2003) for corporate deductors to furnish their TDS returns in electronic form (e-TDS return).
• From F.Y. 2004-2005 onwards furnishing TDS returns in electronic form is also mandatory for government deductors in addition to corporate deductors.
• Deductors (other than government and corporates) may file TDS return in electronic or physical form.
• National Securities Depository Ltd. (NSDL) as the e- TDS Intermediary (appointed by ITD) receives, on behalf of ITD, the e-TDS returns from the deductors.

To ensure proper checks and balances on these payments (TDS) and subsequent credit taken thereof by the deductees, the deductors are required to file TDS returns with the ITD.