AI Drafter 
TaxTMI 
TaxTMI 
Insertion of new sections 194M and 194N.
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....ontract or by way of fees for professional services during the financial year, shall, at the time of credit of such sum or at the time of payment of such sum in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amount equal to five per cent. of such sum as income -tax thereon: Provided that no such deduction under this section shall be made if such sum or, as the case may be, aggregate of such sums, credited or paid to a resident during a financial year does not exceed fifty lakh rupees. (2) The provisions of section 203A shall not apply to a person required to deduct tax in accordance with the provisions of this section. Explanation.--For the purposes of this section,-- ....
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....ccordance with the guidelines issued in this regard by the Reserve Bank of India under the Reserve Bank of India Act, 1934; (2 of 1934.) (iv) any white label automated teller machine operator of a banking company or co-operative society engaged in carrying on the business of banking, in accordance with the authorisation issued by the Reserve Bank of India under the Payment and Settlement Systems Act, 2007; (51 of 2007.) (v) such other person or class of persons, which the Central Government may, by notification in the Official Gazette, specify in consultation with the Reserve Bank of India.'. Note: While Passing the bill in the Loksabha as on 18-7-2019, the following amendments were made: Clause 46 ....
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....ctions shall be inserted with effect from the 1st day of September, 2019, namely:-- Payment of certain sums by certain individuals or Hindu undivided family. '194M. (1) Any person, being an individual or a Hindu undivided family (other than those who are required to deduct income-tax as per the provisions of section 194C, section 194H or section 194J responsible for paying any sum to any resident for carrying out any work (including supply of labour for carrying out any work) in pursuance of a contract, by way of commission (not being insurance commission referred to in section 194D) or brokerage or by way of fees for professional services during the financial years, shall, at the time of....
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....f banking; or (iii) a post office, who is responsible for paying any sum, or, as the case may be, aggregate of sums, in cash, in excess of one crore rupees during the previous year, to any person (herein referred to as the recipient) from one or more accounts maintained by the recipient with it shall, at the time of payment of such sum, deduct an amount equal to two per cent. of sum exceeding one crore rupees, as income-tax: Provided that nothing contained in this sub-section shall apply to any payment made to,-- (i) the Government; (ii) any banking company or co-operative society engaged in carrying on the business of banking or a post office; (iii) any business correspondent of a ....
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.... by issue of a cheque or draft or by any other mode, whichever is earlier. The proviso to the said sub-section provides that no incometax referred to in sub-section (1) shall be deducted, if such sum or aggregate of such sums paid to a resident does not exceed fifty lakh rupees during the financial year. Sub-section (2) of the proposed new section 194M seeks to provide that the provisions of section 203A shall not apply to a person required to deduct tax in accordance with the provisions of this section. The Explanation to the proposed new section also defines the expressions "contract", "professional services" and "work". The proposed new section 194N provides that a banking company or a co-operative society engaged in carrying....