Interest on securities withholding exemption applies to specified securities, qualifying insurers, and Business Trust payments from Special Purpose Vehicles.

Interest on securities otherwise subject to tax deduction at source is exempt from deduction where it concerns specified National Development Bonds, notified debentures, or eligible Central or State Government securities. The exemption excludes specified taxable savings bonds and other Government securities notified for exclusion. No deduction is also required for qualifying interest payable to specified insurers or other insurers holding ownership or full beneficial interest in the securities, and to a Business Trust where interest is paid by a qualifying Special Purpose Vehicle.

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