TaxTMI 
TaxTMI 
Deduction of tax at source--Section 193 read with section 197(1)/(2) of the Income-tax Act, 1961--Interest on Government securities--Rates of tax applicable during the year 1990-91
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.... time of credit to the account of the payee or at the time of payment thereof, whichever is earlier. For this purpose, credit to any suspense account or any other account, by whatever name called, shall be deemed to be a credit of such income to the account of the payee; (b) tax will not be deducted at source from any interest payable to a resident individual on debentures issued by a company in which the public are substantially interested, if the interest is paid by the company by an account payee cheque and the amount of such interest, or, as the case may be, the aggregate amount of such interest paid or likely to be paid during the financial year by the company to such an individual does not exceed Rs.2,500. 3. In this connection, attention is invited to the provisions of sections 200, 203, 203A and 206 of the Income- tax Act, the sum and substance of which is as under:-- (a) According to the provisions of section 203 of the Income-tax Act, every person responsible for deducting tax at source is required to furnish a certificate to the effect that tax has been deducted and to specify therein, inter alia, the amount deducted and other particulars that may be prescribed.....
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....eduction of tax under section 193 from "interest on securities" in Form No.25 prescribed under rule 37 of the Income-tax Rules. It may be noted that the third copy of the TDS certificate issued to the assessee should be enclosed with the annual return. If a person fails to furnish in due time the annual return, he shall, on an order passed by the income-tax authority, under section 272A, pay, by way of penalty, a sum which shall not be less than Rs.100, but which may extend to Rs.200 per day for which the failure continues. (d) According to the provisions of section 200 of the Income-tax Act, any person deducting any sum in accordance with the provisions of section 193 shall pay, within the prescribed time, the sum so deducted to the account credit of the Central Government. If he fails to deduct tax at source, or, after deducting, fails to pay tax to the credit of the Government, he shall be liable to action in accordance with the provisions of sections 201 and 221. Further, penalty under section 271C shall also be leviable for failure to deduct tax at source which will be equal to the amount of tax not deducted. In this connection, attention is also invited to the provision....
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....bsp; I. In the case of a person other than a company : Rates of income-tax (i) Where the person is resident in India-on income by way of interest payable on any security (excluding interest payable on a tax-free security) 10 per cent (ii) Where the person is not resident in India— 1. In the case of a non-resident Indian A. On investment income and long- term capital gains 20 per cent B. On income by way of....
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....bsp; 4. The term "domestic company" means an Indian company or any other company which, in respect of its income liable to tax under the Income-tax Act, 1961, has made the prescribed arrangements for the declaration and payment within India, of the dividends (including dividends on preference shares) payable out of such income. 5. In making payment or crediting interest on Government securities from the 1st April, 1990, you are requested to deduct income-tax at the rates specified above, except in cases where an exemption or abatement certificate granted by an Income-tax Officer/Assessing Officer under sub-section (1) of section 197 of the Income-tax Act, 1961, is produced. In this connection, the following points should be kept in view:-- (i) exemption or abatement certificates issued before the 1st April, 1990, authorising deduction of tax at a particular rate expressed as a percentage of the amount of interest should be accepted and acted upon, if operative for the financial year ending on 31st March, 1991; (ii) where a certificate is issued by the Income-tax Officer....
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....ce with the aforesaid provisions of the Act. 6. Attention is invited in this connection to the provisions of sections 200, 203, 203A and 206 of the Income-tax Act. The sum and substance of which are as under: (a) According to the provisions of section 203 of the Income-tax Act, every person responsible for deducting tax at source is required to furnish a certificate to the effect that tax has been deducted and to specify therein, inter alia, the amount deducted and other particulars that may be prescribed. The certificate has to be furnished within the prescribed period of one month to the person to whose account credit is given or to whom payment is made or the cheque or warrant is issued, as the case may be. By Notification No. S.O.937(E), dated 20th October, 1988 (See [1988] 174 ITR (St.)25), old rule 31 of the Income-tax Rules, 1962, was substituted by a new rule which provides for a unified form of certificate to be issued in Form No.16. Detailed instructions regarding the issue of certificates for tax deducted at source have been issued in Board's Circular No.529 [F.No.275/3/89-IT(B)], dated 13th February, 1989 (See [1989] 176 ITR (St.) 239. If a person fails to furn....
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....ng any sum in accordance with the provisions of section 193 shall pay, within the prescribed time, the sum so deducted to the credit of the Central Government. If he fails to deduct tax at source or after deducting fails to pay the tax to the credit of the Government, he shall be liable to action in accordance with the provisions of sections 201 and 221. Further, penalty under section 271C shall also be leviable for failure to deduct tax at source which will be equal to the amount of tax not deducted. In this connection, attention is also invited to the provisions of section 276B of the Income-tax Act, according to which if a person fails to pay to the credit of the Central Government the tax deducted at source by him, he shall be punishable with rigorous imprisonment for a term which shall not be less than three months but which may extend to seven years and with fine. 7. In case of any doubt, the Assessing Officer or the local Public Relations Officer of the Income-tax Department should be consulted before making deduction from interest on Government securities. 8. Copies of this circular will be available with the Directorate of Income-tax (Research, Statistics, Publicatio....
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....oes not exceed Rs. 1,00,000 Rs. 7,600 plus 40 per cent of the amount by which the total income exceeds Rs. 50,000; (5) Where the total income exceeds Rs. 1,00,000 Rs. 27,600 plus 50 per cent of the amount by which the total income exceeds Rs. 1,00,000. Surcharge on income-tax The amount of income-tax computed in accordance with the preceding provisions of this Sub-Paragraph shall— (i) in the case of every individual, Hindu undivided family or association of persons or body of individuals referred to in sections 88 and 88A having a total income exceeding seventy-five thousand rupees, be reduced by the amount of rebate of income-tax calculated under Chapter VIII-A, and the income-tax as so reduced, (ii) in the case of every person, other than those mentioned in item (i) having a total income exceeding seventy-five thousand rupees, be increased by a surcharge for purposes of the Union calculated at the rate of eight per cent of such income-tax: Provided that no such surcharge shall be payable by a non-resident. ANNEXURE II FORM NO. 15F [See rule 29C(1)] Declaration under section 197A(1)....