Tax-exempt land acquisition compensation remains outside tax deduction at source when paid under qualifying awards or agreements.

Compensation or enhanced compensation for acquisition of certain immovable property, ordinarily subject to tax deduction at source under Section 393(1), Table Sl. No. 3(iii), is not subject to deduction where the income is exempt under Section 96 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013. The payment must fall within the specified compensation category and be payable under an award or agreement qualifying for that exemption.

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