Will deductor received demand notice for short deduction where C flag has raised for Valid PAN ?

Short deduction will be calculated on the basis of both valid and invalid PAN :

• Valid PAN short deduction will be calculated if rate mentioned in the statement is less than the rate applicable as per Income Tax Act for the relevant section code.
• Invalid PAN short deduction will be calculated if TDS deducted is less than 20% of the Amount paid/Credited or rates applicable whichever is higher.