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Act Rules Bills
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Tax Deduction and Collection Account Number mandated for deductors and collectors to enhance tracking and reporting under the new bill
Clause 397(1) requires every person responsible for deducting or collecting tax to apply for and, when allotted, quote a Tax Deduction and Collection Account Number (TDCAN) in all prescribed TDS/TCS documents; it prevents duplication, allows prescribed timelines and forms, and provides targeted exemptions including notified persons and categories cross referenced to other provisions.
Act Rules Bills
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Deemed assessee in default: consolidated TDS/TCS consequences including interest, asset charge, and conditional relief.
Clause 398 deems persons required to deduct or collect tax who fail to deduct, collect, or remit to be assessee in default, subject to interest, recovery and a statutory charge on assets. A conditional exception applies where the payee has reported and paid the income tax and an accountant's certificate in the prescribed form is furnished; interest is bifurcated between pre-collection and post-collection periods and must be paid before filing the relevant statement. The clause sets a limitation period for default orders and requires satisfaction of good and sufficient reasons before penalties are imposed.
Act Rules Bills
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TDS/TCS reporting modernization: unified mandates for remittance, verified statements, non-resident reporting and six-year corrections.
Clause 397(3) mandates that every person responsible for deduction or collection, including employers and designated government officers, remit deducted or collected tax to the Central Government within prescribed timelines and furnish verified statements in prescribed forms; it requires the prescribed authority to issue statements to buyers/licensors/lessees, mandates reporting of payments to non-residents irrespective of taxability, recognises a six-year correction window for statement amendments, compels specified financial institutions to file statements for certain payments, and preserves liability where tax collection fails.
Act Rules Bills
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Lower TCS certificates permit reduced collection when taxpayer income justifies it, with mandatory certified issuance and electronic processes.
Clause 395(3) permits buyers, licensees or lessees to apply to the Assessing Officer for collection of tax at a lower rate where the AO is satisfied that the applicant's total income justifies lower collection; the AO issues a certificate specifying the reduced rate and validity, subject to rules and to cancellation after hearing. Clause 395(4) requires every person deducting or collecting tax to issue a certificate to the deductee or collectee specifying the amount, rate and other prescribed particulars within prescribed timelines, with electronic issuance anticipated.
Act Rules Bills
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Tax collection at source: consolidated TCS framework aligns rates, preserves declaration exemptions and prevents double collection.
Clause 394 consolidates TCS rules into a table specifying liable collectors, receipt categories, tiered rates and timing (earlier of debit or payment), retains a declaration based exemption for residents using goods for manufacturing/processing/production or power generation with prescribed duplicate filings and reporting, incorporates anti overlap safeguards preventing double collection on remittance and tour package transactions, and adopts existing definitions for forest produce while omitting certain granular definitions and the lower/nil TCS certificate mechanism pending further rulemaking.
Act Rules Bills
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PAN furnishing requirement: higher withholding rates apply where PAN is not provided, with specified carve-outs for non-residents.
Clause 397(2) requires recipients and payers of amounts subject to TDS/TCS to furnish and quote a valid PAN; failure to do so triggers withholding or collection at enhanced statutory rates, invalidates declarations or applications for lower or nil deduction absent PAN, and mandates PAN disclosure in all transactional documents, while providing specified exemptions for certain non-residents and a cap on TDS for rent in defined cases.
Act Rules Bills
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TDS/TCS reporting obligations expanded: mandatory electronic payment, verified statements, correction window and liability for non-collection.
Clause 397(3) requires prompt payment of tax deducted or collected to the Central Government and the furnishing of verified statements in prescribed forms and manner. It expands reporting to include payments to non-residents, special procedures for government remittances without challans, and interest payments below thresholds by specified entities. The clause permits correction statements within six years and imposes liability to pay where tax is not collected, while delegating operational details to prescribed authorities and mandating electronic filing and verification.
Act Rules Bills
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Bar against direct demand protects assessees from paying tax already deducted at source, placing recovery obligations on the deductor.
A statutory bar prevents authorities from calling an assessee to pay tax to the extent tax has been deducted at source: Clause 401 of the 2025 Bill mirrors Section 205 of the 1961 Act by protecting the assessee where tax was actually deducted, limiting liability "to the extent" of deduction and leaving recovery, penalties, and prosecution against the deductor for any non deposit.
Act Rules Bills
Show AI Summary
Person responsible for paying: allocation of TDS/TCS duties to payers, principal officers, authorised remitters and government payors.
Clause 402(27) designates the person responsible for paying for TDS/TCS according to payment type and payer status: employers (and company principal officers) for salaries; payers (and company principal officers) for interest and other chargeable sums; authorised persons for remittances to NRIs; payers for reporting payments to non-residents irrespective of chargeability; and drawing and disbursing officers (or the actual payor) for government payments, with cross-references to FEMA and updated agent definitions.
Act Rules Bills
Show AI Summary
TDCAN requirement modernisation centralises TAN/PAN linkage and reporting, tightening compliance and correction procedures.
Clause 397 requires persons deducting or collecting tax to apply for and, once allotted, quote a Tax Deduction and Collection Account Number (TDCAN) in all prescribed documents; it consolidates deduction and collection numbers, sets out statutory carve-outs and government-notified exemptions, integrates PAN linkage and consequences for non-furnishing, and centralises payment, reporting and correction mechanisms including procedures for non-resident payments and government offices.
Act Rules Bills
Show AI Summary
TDS/TCS certificate obligation requires deductors and collectors to issue prescribed certificates enabling tax credit and digital reporting.
Clause 395(4) requires every person deducting or collecting tax at source to issue a certificate to the deductee/collectee specifying the amount of tax deducted or collected, the rate, and any other prescribed particulars within a prescribed period; employers who pay tax on behalf of employees must similarly furnish a certificate confirming payment to the Central Government. The clause covers both TDS and TCS, delegates format and timing to subordinate rules, and anticipates digital and harmonized implementation while leaving rectification, duplicate issuance and penalty mechanics to rules.
Act Rules Bills
Show AI Summary
Non-exclusivity of source-based tax collection allows authorities to pursue additional recovery methods when payments are provisional.
Clause 390(4) states that taxes paid by deduction or collection at source, advance payments and specified payments operate in addition to any other mode of tax collection to discharge the liability for income assessed for a tax year, preserving the tax authority's power to pursue alternative recovery measures where such anticipatory payments are provisional, insufficient, or incorrect while allowing credit or refund for any excess.
Act Rules Bills
Show AI Summary
TDS/TCS enforcement: deeming of defaulting deductors as assessees in default triggers interest, charge on assets, and conditioned relief.
Clause 398 deems persons required to deduct or collect tax, including principal officers and specified collectors, to be an assessee in default where tax is not deducted, not collected, or not paid to the government; relief is available if the recipient files a return, includes the relevant sum, pays the tax due and the deductor/collector furnishes a prescribed accountant's certificate. Interest is prescribed for the periods between deductibility, deduction and payment, unpaid tax plus interest is a statutory charge on assets, time limits for default orders are specified, and penalty requires satisfaction of lack of good and sufficient reasons.
Act Rules Bills
Show AI Summary
Centralised TDS/TCS processing: automated, time bound framework mandates intimation within a year and covers correction statements.
Clause 399 creates an automated framework for processing TDS and TCS statements, including correction statements, requiring rectification of arithmetical errors and adjustment of apparent incorrect claims, computation of interest and fee, determination of net payable or refundable amounts after adjusting prior payments, issuance of a formal intimation to the deductor/collector, and grant of any refund due; it also mandates that intimations be sent within a year from the end of the tax year and empowers the Board to make a centralised processing scheme.
Act Rules Bills
Show AI Summary
TDS/TCS compliance: expanded reporting and verified statement obligations, including cross-border and below-threshold payment reporting.
Clause 397(3) requires persons responsible for deduction or collection of tax, and certain employers, to pay amounts to the credit of the Central Government within prescribed time and to submit verified statements in prescribed form and manner; it mandates reporting of payments to non-residents whether or not chargeable, requires special statements for government payments without challans, permits correction statements within six years, obliges reporting of below-threshold interest payments by specified entities, and makes collectors who fail to collect liable to pay the tax.
Act Rules Bills
Show AI Summary
Tax credit for source deductions ensures remitted taxes are treated as payment on behalf of the relevant taxpayer and allocated by rule.
Clause 390(5) treats sums remitted as tax paid on behalf of the person from or in respect of whose income such tax was deducted or collected, and Clause 390(6) empowers the Board to make rules for allocating that credit to such persons or to others and for specifying the tax year for which credit is allowed, extending the scope beyond conventional TDS/TCS to include specified pre-payments and leaving operational detail to subordinate rules.
Act Rules Bills
Show AI Summary
Tax deducted is income received: gross receipts included for tax computation with credit for foreign withholding.
Clause 396 deems amounts deducted under the relevant withholding chapter and income tax deducted abroad (where credit is allowed) to be income received for computing an assessee's taxable income, with specified carve out exceptions; this preserves gross income inclusion while permitting credit for taxes withheld and raises interpretative issues about the chapter's scope, the stated exceptions, cross border withholding and transitional treatment.
Act Rules Bills
Show AI Summary
TDS nil-declaration prevents withholding when estimated total income is below taxable threshold, subject to prescribed declaration and reporting.
Clause 393(6) permits certain recipients to avoid TDS by furnishing a prescribed written declaration that their estimated total income for the year yields nil tax; upon a valid declaration the payer must not deduct tax on specified payments and must forward a copy to tax authorities, subject to the condition that aggregate such incomes do not exceed the basic exemption limit and to general anti evasion consequences for false declarations.
Act Rules Bills
Show AI Summary
Lower Deduction Certificates: streamlined TDS/TCS certification requiring AO satisfaction and binding certificate rates.
Clause 395(1) creates a mechanism for Lower Deduction Certificates allowing taxpayers to apply for lower or nil deduction of tax at source; the Assessing Officer must issue a certificate when satisfied on objective material, the deductor must apply the specified rate until the certificate's validity, and procedural details, scope, validity periods and ancillary measures are to be provided by rules.
Act Rules Bills
Show AI Summary
TDS on securities income: clarified withholding rules, treaty relief mechanics, and exemptions for capital gains and exempt fund receipts.
Clause 393 establishes a tabular TDS regime on income from securities, distinguishing taxable securities income from capital gains and exempt receipts. Clause 393(2) prescribes withholding entries for Foreign Institutional Investors with rates referenced to an interpretative note and a 10% rate for specified funds, subject to documentation for treaty benefits. Clause 393(4) consolidates exemptions by excluding capital gains payable to foreign investors and exempt income of specified funds from TDS, aiming to avoid unnecessary withholding and refund procedures.

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Review of concessional rates of BCD prescribed in notification no. 50/2017 - Customs dated 30.62017: The BCD exemption hitherto available on certain goods are being withdrawn by omitting following entries of notification No. 50/2017-Customs dated 30.6.2017.

3 February, 2020

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Budget 2020-21 + FINANCE BILL, 2020

S. No.

S. No. of Notification No 50/2017-customs

Description

1.

5

Tuna bait [0303]

2.

7

Goods upto an aggregate of ten thousand metric tonnes of total imports of Milk and cream, in powder, granules or other solid form in a financial year. [0402 10, 0402 21 00]

3.

7A

Whey, concentrated, evaporated or condensed, liquid or semi-solid [0404 10 10]

4.

7B

Other Whey [0404 90 00)

5.

8

Butter Ghee, Butter Oil [0405]

6.

9

Other cheese [0406 90 00)

7.

10

Pancreas (Products of animal origin, not elsewhere specified) (Chapter 5]

8.

11

Conch shell [0508 00]

9.

18

Bulbs or tubers, other live plants [0601 or 0602]

10.

36

All goods other than meslin or wheat [1001]

11.

38

Meslin [1001]

12.

40

Maize upto an aggregate of five lakh metric tonnes of total imports of such goods in a financial year [1005 90]

13.

47

Sugar beet seeds [1209 10 00)

14.

56

Edible oils [1508, 1512, 1513, 1514, 1515 or 1511 10]

15.

58

Refined vegetable oils of edible grade, in loose or bulk form (other than palm oil) [chapter 15]

16.

59

Vegetable oils of edible grade, in loose or bulk form (other than those specified against S. No. 58 and palm oil), imported for the manufacture of oil commonly known as “Vanaspati” or for refining.

Explanation. -The expression “Vegetable oil” means-

(a) in the case of cottonseed oil, oil having a free fatty acid content of at least 0.2%; and

(b) in the case of any other vegetable oil. oil with free fatty acid content of at least 0.5%. [15]

17.

68

Crude sunflower seed or safflower oil upto an aggregate of one lakh and fifty thousand metric tonnes of total imports of such goods in a financial year [1512 11]

18.

69

Crude sunflower seed or safflower oil other than those specified against S. No. 68 [1512 11]

19.

72

Refined rape, colza or mustard oil upto an aggregate of one lakh and fifty thousand metric tonnes of total imports of such goods in a financial year (1514 19 or 1514 99]

20.

78

Margarine, animal or vegetable oils of edible grade [1517 or 1518]

21.

83

Glycerol, crude; glycerol waters and glycerol lyes, (other than crude glycerin) [1520 00 00]

22.

88A

Raw Sugar upto an aggregate of three lakh metric tonnes of total imports of such goods. Provided that the import of raw sugar in physical form is completed within sixty (60) days from the date of issue Of the Tariff Rate Quota Allocation Certificate or license by Directorate General of Foreign Trade (DGFT) to the importer. Provided further that the importer shall convert the raw sugar into white/ refined sugar within a period, not exceeding thirty (30) days, from the date of filing of bill of entry or the date of entry inwards, whichever is later [1701]

23.

89

Dextrose Monohydrate [1702)

24.

92

Molasses resulting from extraction or refining of sugar [1703]

25.

93

Chewing gum whether or not sugar coated [1704 10 00]

26.

94

Food preparations, for infant use and put up for retail sale, of-

(i) goods of headings 0401 to 0404, containing cocoa calculated on a totally defatted basis, in a proportion by weight of 5% or more but less than 10%; or

(ii) flour, meal, starch or malt extract containing cocoa calculated on a totally defatted basis, in a proportion by weight of 40% or more but less than 50% [1806 90)

27.

95

Preparations for infant use put up for retail sale [1901 10]

28.

98

preserved potatoes [2004 10 00]

29.

99

Peanut Butter [2008 11 00]

30.

105

Wine, for use as sacramental wine [22]

31.

108

Angostura bitters [2208]

32.

113

Fin fish feed [2301 20, 2309 90 32, 2309 90 39]

33.

115

Dietary soya fibre [2304]

34.

148

Naphtha, when imported by Ratnagiri Gas and Power Private Limited (RGPPL), for use in generation of electricity in the power plants of Ratnagiri Gas and Power Private Limited (RGPPL) at Dabhol, District Ratnagiri, Maharashtra [2710]

35.

149

Naphtha, when imported for generation of electrical energy by a generating company as defined in section 2(28) of the Electricity Act, 2003 (36 of 2003) to supply electrical energy-or to engage in the business of supplying electrical energy [2701]

36.

152

Propane, Butane [2711 12 00, 2711 13 00]

37.

160

Electrical energy [ 2716 00 00]

38.

170

Phosphoric acid, for the manufacture of fertilizers(28]

39.

212

Japanese Encephalitis (JE) vaccine, imported by the Andhra Pradesh Government through UNICEF [30]

40.

220

Kyanite salts, in a form indicative of their use for manurial purpose [31]

41.

243

Isolated soya protein [3504]

42.

244

Colour positive unexposed cinematographic film in jumbo rolls and colour negative unexposed cinematographic film in rolls of 400 feet and 1000 feet [37]

43.

245

Instant print film [3701 20 00 or 3702]

44.

246

Cinematographic films, exposed but not developed [3704]

45.

247

Promotional material (like Trailers, making of film etc.) imported in the form of electronic promotion kits (EPK)/ beta cams (Any Chapter)

46.

263

The following polymers of ethylene, namely: -

(i) Cow density polyethylene (LDPE),

(ii) Linear low-density polyethylene (LLDPE),

(iii) High density polyethylene (HDPE),

(iv) Linear medium density polyethylene (LMDPE),

(v) Linear high-density polyethylene (LHDPE) [3901]

47.

264

All goods other than poly 'so-butylene [39021

48.

266

All goods [3903]

49.

274

Compostable polymer or bio-plastic used in the manufacture of bio degradable agro mulching films, nursery plantation pots and flower pots [3913 90 90]

50.

275

Water blocking tape for use in the manufacture of insulated Wires and cables falling under heading 8544 (except sub-heading 8544 11) [3919 90 90]

51.

278

Subbed polyester base, imported by M/s. Hindustan Photo Films Manufacturing Company Limited, Udhagamandalam for the manufacture of medical or industrial X-ray films and graphic art films [39201

52.

286

Patent leather [4114 20 10]

53.

287

Raw furskins [4301). tanned and dried furskins [4302]

54.

386

Lead bars. rods. profiles and wire [7806]

55.

388

Zinc tubes, pipes and tube or pipe fittings [7907]

56.

389

Tin plates, sheets and strip, of a thickness exceeding 0.2 mm; tin foil (whether or not printed or backed with paper, paperboard, plastics or similar backing materials), of a thickness (excluding any backing) not exceeding 0.2 mm; tin powders and flakes [8007]

57.

398

Parts and components of the goods specified in List 10 required for use in high voltage power transmission project (Any chapter]

58.

401

All items of equipment including machinery and rolling stock, procured by or on behalf of Delhi Metro Rail Corporation Ltd. for use in-

(i) Delhi MRTS Project Phase-I, and

(ii) Specified corridors of Delhi MRTS Project Phase-Il, comprising of the following, namely: -

(a) Vishwavidyalaya- Jahangirpuri;

(b) Central Secretariat-Qutab Minar (via All India Institute of Medical Sciences);

(c) Shahdara- Dilshad Garden;

(d) Indraprastha-New Ashok Nagar;

(e) Yamuna Bank-Anand Vihar-lnter State Bus Terminus; and

(f) Kirti Nagar-Mundka (along with operational Link to Shahdara- Rithala corridor) (Any Chapter)

59.

412

Goods specified in List 15 required for construction of roads [84 or any other chapter]

60.

447

The following goods required for manufacture of Optical disk drives (ODD), namely: -

(i) Pick up assembly

(ii) Digital signature procession integrated circuit

(iii) DC motor

(iv) LDO voltage regulator [84 or Any other Chapter]

61.

456

The following goods, namely: -

(a) Sprinklers and drip irrigation systems for agricultural and horticultural purposes;

(b) Micro Irrigation equipment [8424]

62.

457

Poultry incubators and brooders [8436 21 00]

63.

459

Parts for manufacture of printers falling under sub heading 8443 32 (except 8443 99 51, 8443 99 52, 8443 99 53) [8443]

64.

465

CD -Writers (8471]

65.

474

MP3 or MP4 or MPEG 4 player with or without radio or video reception facility [85]

66.

483

One set of pre-recorded cassettes accompanying books for learning languages and essential complement to such books, [85]

67.

484

Audio cassettes, if recorded with material from books, newspaper or magazines, for the blind [85]

68.

515

Colour television picture tubes for use in the manufacture of cathode ray televisions [8540 11]

 

 


Full Text:

Budget 2020-21 + FINANCE BILL, 2020

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Acts Income Tax