Deduction of income-tax at source under section 194D now attracts an additional surcharge, increasing withholding obligations.
Deduction of income-tax at source under Section 194D on insurance commission for 1987-88 must use the rates notified earlier, but the income-tax so computed shall be increased by a surcharge for Union purposes at the rate prescribed by the Finance (Amendment) Act, 1987, the levy of which is effective from 16 December 1987; insurers are directed to apply withholding inclusive of this surcharge and to notify all concerned, seeking departmental assistance if required.

Tax deduction at source on prize winnings: statutory surcharge added to applicable tax rates for the relevant financial year.
Deduction of tax at source is required on winnings from lotteries, crossword puzzles and horse races, and the income-tax computed under the applicable withholding rates is to be increased by an additional surcharge for Union purposes; the circular directs communication of this amendment to State Governments, Union Territory administrations and race clubs and offers administrative contacts for assistance.

Surcharge on income-tax increases tax deduction at source on interest from government securities and requires immediate withholding adjustments.
Tax to be deducted at source on interest payable on Government securities must be increased by a surcharge calculated as a percentage of the income-tax so computed, and this surcharge is to be applied from the stated commencement date; Treasury Officers, Banks and other payors are to be instructed immediately to implement the adjusted withholding, with Income-tax Officers available for assistance.

Remedial measures in summary-assessment cases permitted to rectify assessing officers' mistakes in estate duty and wealth tax.
The Directorate confirmed that the CBDT instruction against remedial action in summary-assessment cases was taken to apply to Wealth Tax and Estate Duty assessments, but that a subsequent Board instruction permits remedial measures to rectify assessing officers' mistakes even in summary-assessment cases; the matter should be taken up with the local Accountant General.

Annual meetings with tax consultants to discuss law changes and promote timely filing and tax payment cooperation.
Chief Commissioners shall organise annual meetings with tax consultants to discuss problems from law changes and to enlist public cooperation in timely filing of income-tax returns and payment of taxes, with senior departmental officers participating; meetings are normally at the Chief Commissioner's headquarters, outside consultants attend at their own cost, and the Chief Commissioner may choose an alternative venue or ask the local Commissioner to organise the meeting.

Tax deduction at source under section 194C: deduction rates apply to contractor payments, increased by a Union surcharge.
Payments to resident contractors by specified agencies require deduction of tax at source under section 194C on payment or credit, and contractors must deduct tax on payments to resident sub-contractors; no deduction is required where the contract consideration does not exceed the statutory threshold. An amendment mandates that such deductions be increased by a Union surcharge calculated on the tax deducted, applicable only to payments after the amendment's effective date, and the circular directs state disbursing officers and undertakings to comply and seek assistance from Income-tax Officers if needed.

Deduction at source from salaries: employer may deduct tax on aggregate salary when employee has multiple employers, subject to disclosure.
Employers must deduct tax at source on salary payments and, where an individual has multiple employers or changes employers, a chosen employer may deduct tax on the aggregate salary after the employee furnishes verified details of prior salary and tax deducted. Government and public sector payrolls may allow relief for arrears or advances before deduction, and an employee may provide particulars of other income so the employer can deduct tax on total income provided the total deduction is not less than tax deductible on salaries alone; implementing rules have been notified and Form 10E must be attached to annual TDS certificates.

Belated refund admission expanded for small withholding-tax refunds, subject to carry-forward, supplementary and assessment conditions.
Income-tax Officers are authorised to admit belated refund claims arising from tax deducted at source up to the stated monetary limit where (i) the refund results from specified withholding provisions and does not exceed that limit, (ii) the returned income is not a loss claimed for carry forward, (iii) the claim is not supplementary after original assessment, and (iv) the income is not assessable in another person's hands; effective from the stated date.

Belated refund claims approval procedure updated: higher-level authority approval required for larger refunds beyond standard officer limits.
The Board's order, effective 10.2.88, raises the monetary band for belated refund claims and requires that refunds above the prior officer threshold but within the new upper band obtain prior approval of the Chief Commissioner, who will exercise administrative control and ensure compliance with Board conditions; refunds at or below the prior lower threshold continue to require Commissioner approval under earlier instructions.

Change of previous year permitted to extend accounting period for transitional assessment, subject to no loss of revenue.
Assessing officers should liberally permit taxpayers to change or extend their accounting year so the previous year relevant to the assessment year 1988 89 ends on 31 March 1988, under the statutory provision allowing change of previous year, provided the longer previous year does not cause any loss of revenue; officers must publicise this option to taxpayers and trade associations.

Applicability of section 194C: payments under community implemented rural employment schemes not subject to contractor TDS deduction.
Section 194C withholding applies where a contractual relationship with a contractor or sub contractor exists and creates an obligation to deduct tax at source. Payments under NREP and RLEGP are not subject to section 194C because implementation is through Panchayati Raj institutions and voluntary organisations under State supervision, the schemes ban engagement of contractors or intermediaries, and there is no contract with State Governments that would attract section 194C.

National Savings Scheme deduction permitted for salary TDS; withdrawals and partial interest inclusion taxable on withdrawal.
Deduction for deposits in the National Savings Scheme may be allowed by drawing and disbursing officers when computing tax to be deducted at source from salaries. The statutory provision permits a deduction equal to fifty percent of deposits subject to an annual ceiling; on withdrawal fifty percent of the withdrawn amount is treated as income in the year of withdrawal, and interest on deposits is taxable only in the year of withdrawal to the extent of fifty percent. The deduction is additional to the deduction available under the other deposit-linked deduction provision.