TaxTMI 
TaxTMI 
Section 193 of the Income-tax Act, 1961--Deduction of income-tax at source from interest on securities during the financial year 1993-94--Instructions regarding
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....ver name called ) shall be deemed to be a credit of such income to the account of the payee. 3. For the financial year 1993-94, there is no change in the basic rates of tax and surcharge in so far as they relate to deduction of tax at source from the payment of interest on securities. The applicable rates are given in Part II of the First Schedule to the Finance Act, 1993. Briefly stated, these are as follows : (A) In the case of a payee other than a company,— (i) where the payee is resident in India,— (a) On income by way of interest payable on any security, other than tax-free security, of the Central or State Government; 10 per cent (b) on income by way of interest payable on any debentures or other securities for money issued on behalf of any local authority or a corporation established by a Central, State or Provincial Act; 10 per cent (c) on income by way of interest on any debentures issued by a company where such debentures are listed on a recognised stock exchange in India in accordanc....
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.... India in accordance with the Securities Contracts (Regulation) Act, 1956, and, any rules made thereunder 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 individual does not exceed Rs. 2,500. (c) tax will not be deducted at source under section 193 in the case of a resident individual who makes a declaration in Form No. 15F (vide annexure II) as provided by section 197A, to the effect that tax on his estimated total income of the financial year 1993-94 will be nil. A copy of such declaration should be forwarded by the tax-deductor on or before the seventh day of the month next following the month in which the declaration is received by him, to the Chief Commissioner/Commissioner of Income-tax concerned, as provided in rule 29C(5) of the Income-tax Rules, 1962. (d) no tax will be deducted at source or it will be deducted at a lower rate in the case of a person (including a company) where a certificate under section 197 is issued by the Assessing Officer on or after 1st April, 1993, specifying ....
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.... the Income-tax Rules, 1962), the sum so deducted to the credit of the Central Government. In the case of deduction by or on behalf of the Government, the sum has to be paid on the day of deduction itself. In other cases, normally, the sum has to be paid within one week from the last day of the month in which the deduction is made. If a person fails to pay tax to the credit of the Central Government, he shall be liable to action under the provisions of section 201. Sub-section (1A) of section 201 lays down that such person shall also be liable to pay simple interest at fifteen per cent. per annum on the amount of such tax from the date on which such tax was deductible to the date on which such tax is actually paid. Further, section 271C lays down that if any person fails to deduct tax at source, he shall be liable to pay by way of penalty a sum equal to the amount of tax which he failed to deduct at source. In this regard, attention is also invited to the provisions of section 276B which lays down that 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 le....
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....cial year to which it relates. It may be noted that a copy of each TDS certificate issued during the financial year should be enclosed with the annual return. If a person fails to furnish in due time the annual return he shall be liable to pay, by way of penalty, under section 272A(2), a sum which shall not be less than Rs. 100 but which may extend to Rs. 200 for every day during which the failure continues. The maximum penalty will, however, not exceed the amount of tax deductible at source. 7. The State Governments/Union Territory administrations, the Reserve Bank of India, other banks/financial institutions, etc., are requested to bring the contents of this circular to the notice of their concerned departments/officers, who are responsible for making payment of interest on securities, for necessary action and compliance. 8. These instructions are not exhaustive and are issued with a view to helping the persons responsible for deducting tax at source from payment of interest on securities. In the case of any doubt, reference should be made to the relevant provisions of the Income-tax Act, 1961, and the Income-tax Rules, 1962. If any assistance is required, the Assessing Off....
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....AIMING RECEIPT OF "INTEREST ON SECURITIES" WITHOUT DEDUCTION OF TAX I ....................................................................................................................................... son/daughter/ wife of.................................................................... resident of @................................................................... do hereby declare :— 1. that the securities particulars of which are given below, stand in my name and are beneficially owned by me, and the interest therefrom is not includible in the total income of any other person under sections 60 to 64 of the Income-tax Act, 1961: Description of securities Number of securities Date of securities Amount of securities Date(s) on which the securities were acquired by the declarant 2. that my present occupation is.......................... 3. that the tax on my estimated total income, including the interest on securities referred to in paragraph 1 above, computed in accordance with the provisions of the Income-ta....
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....end to three years and with fine. [FOR USE BY THE PERSON TO WHOM THE DECLARATION IS FURNISHED] 1. Name and address of the person responsible for paying the interest on securities mentioned in Paragraph 1 of the declaration. 2. Date on which the declaration was furnished by the Declarant 3. Period for which interest is paid 4. Amount of interest 5. Date on which interest is paid Forwarded to the Chief Commissioner or Commissioner of Income-tax................ ................................. Signature of the person Place........ responsible for paying Date......... interest on securities. ANNEXURE III FORM NO. 16A [See rule 31(1)(b)] Certificate of deduction of tax at source under section 203 of the Income-tax Act, 1961 [For interest on securities, dividends, interest other than 'interest on securities' winnings from lottery or crossword puzzle, winnings from horse race, payments to contractors and sub-contractors, insurance co....