With a view to clarifying and facilitating such electronic payment of taxes by different categories of taxpayers, the CBDT has issued Circular No. 5 of 2008. The Circular clarifies that a taxpayer can make electronic payment of taxes from the account of any other person. However, the challan for making such payment must clearly indicate the Permanent Account Number (PAN) of the taxpayer on whose behalf the payment is to be made. It will not be necessary for the assessee to make payment of taxes from his own account in an authorized bank.

Further, it has also been clarified that for the purpose of the newly inserted rule 125 of the Income-tax Rules, 1962, the meaning of tax will include payment of tax deducted at source (TDS) or tax collected at source (TCS). Therefore, a company and such other taxpayers (other than a company), to whom provisions of section 44AB of the Income-tax Act, 1961 are applicable, are also required to mandatorily make such payment electronically.