2010 (12) TMI 1344

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....er the Motor Vehicles Act. The learned Tribunal has passed a cryptic order, which reads as follows:- "The case is listed for proper orders today. Heard. I have also gone through the case file. Since the TDS has been deducted against the provisions of Section 194(A) of the Income-tax Act by the JD/Insurance Company, it is directed to deposit the said amount in this Tribunal so that it can be paid to the DH/petitioner on or before the next date of hearing. Now put up for further orders on 22.6.2010." 3. A bare reading of the order shows that the learned Tribunal has not even referred to the provisions of Section 194(A) and has made a sweeping statement that the said section is not applicable. This shows total non application of mi....

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....redited or paid by way of interest on the compensation amount awarded by the Motor Accidents Claims Tribunal where the amount of such income or, as the case may be, the aggregate of the amounts of such income credited or paid during the financial year does not exceed fifty thousand rupees." 5. It is thus obvious that under the Income-tax Act, TDS has to be deducted on interest income accruing even on payments deposited under the Motor Vehicles Act when such interest income exceeds Rs.50,000/-. 6. The question which arises is whether the income of each of the claimants by way of interest from the compensation exceeds Rs. 50,000/- or not. The operative portion of the Award of the Tribunal reads as follows:- "In view of my findi....

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.... completion be consigned to record room." 7. It is thus apparent that petitioner No.1-claimant Smt. Viyasan Devi, widow of the deceased was held entitled to Rs. 5, 01,400/- and interest @ 7.5% per annum which would work out to Rs.37,605/-per annum only, which is less than Rs.50,000/-. As far as claimants No.2, 5, 6 and 7 are concerned, they have only been awarded Rs. 1 lakh each and annual interest thereupon shall only work out to Rs.7500/-. 8. While deducting tax at source it has to be deducted in respect of the income being derived by a person. All the claimants cannot be clubbed together and the income of each claimants will have to be individually assessed because each claimant would be a separate person within the meaning of the ....