No-deduction TDS exemption applies to specified securities interest and qualifying insurers or Business Trusts receiving eligible payments.

No deduction of tax at source is required on specified interest on securities where a security-based or recipient-based exemption applies. Exempt securities include National Development Bonds, notified debentures, and qualifying Central or State Government securities, subject to exclusions for specified taxable savings bonds and notified securities. The exemption also covers qualifying interest payable to specified insurers and to a Business Trust where a Special Purpose Vehicle pays interest on securities held by the trust.

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