Chapter
XVII
Collection and recovery of tax
A.—General
Deduction at source and advance
payment.
190. (1)
Notwithstanding that the regular assessment in respect of any income is to be
made in a later assessment year, the tax on such income shall be payable by
deduction [or collection] at source or by advance payment [or by payment under
sub-section (1A) of section 192], as the case may be, in accordance with the
provisions of this Chapter.
(2) Nothing
in this section shall prejudice the charge of tax on such income under the
provisions of sub-section (1) of section 4
191. [***] In the case of income in respect of
which provision is not made under this Chapter for deducting income-tax at the
time of payment, and in any case where income-tax has not been deducted in
accordance with the provisions of this Chapter, income-tax shall be payable by
the assessee direct.
[***]
[Explanation.—For the removal of
doubts, it is hereby declared that if any person referred to in section 200 and
in the cases referred to in section 194, the principal officer and the company
of which he is the principal officer does not deduct the whole or any part of
the tax and such tax has not been paid by the assessee direct, then, such
person, the principal officer and the company shall, without prejudice to any
other consequences which he or it may incur, be deemed to be an assessee in
default as referred to in sub-section (1) of section 201 in respect of such
tax.]
B.—Deduction at source
192. (1) Any person responsible for paying any
income chargeable under the head “Salaries” shall, at the time of payment,
deduct income-tax [***] on the amount payable
at the average rate of income-tax [***] computed on the basis of the [rates in
force] for the financial year in which the payment is made, on the estimated
income of the assessee under this head for that financial year.
[(1A) Without prejudice to the provisions
contained in sub-section (1), the person responsible for paying any income in
the nature of a perquisite which is not provided for by way of monetary
payment, referred to in clause (2) of section 17, may pay, at his option, tax on the whole or
part of such income without making any deduction therefrom at the time when
such tax was otherwise deductible under the provisions of sub-section (1).
(1B) For the purpose of paying tax under
sub-section (1A), tax shall be determined at the average of income-tax computed
on the basis of the rates in force for the financial year, on the income
chargeable under the head “Salaries” including the income referred to in
sub-section (1A), and the tax so payable shall be construed as if it were, a
tax deductible at source, from the income under the head “Salaries” as per the
provisions of sub-section (1), and shall be subject to the provisions of this
Chapter.]
[(2) Where,
during the financial year, an assessee is employed simultaneously under more
than one employer, or where he has held successively employment under more than
one employer, he may furnish to the person responsible for making the payment
referred to in sub-section (1) (being one of the said employers as the assessee
may, having regard to the circumstances of his case, choose), such details of
the income under the head “Salaries” due or received by him from the other
employer or employers, the tax deducted at source therefrom and such other
particulars, in such form and verified in such manner as may be prescribed, and
thereupon the person responsible for making the payment referred to above shall
take into account the details so furnished for the purposes of making the
deduction under sub-section (1).]
[(2A) Where
the assessee, being a Government servant or an employee in a [company,
co-operative society, local authority, university, institution, association or
body] is entitled to the relief under sub-section (1) of section 89, he may furnish to the person responsible for
making the payment referred to in sub-section (1), such particulars, in such
form and verified in such manner as may be prescribed, and thereupon the person
responsible as aforesaid shall compute the relief on the basis of such
particulars and take it into account in making the deduction under sub-section
(1).]
[Explanation.—For
the purposes of this sub-section, “University” means a University established
or incorporated by or under a Central, State or Provincial Act, and includes an
institution declared under section 3 of the University Grants Commission Act,
1956 (3 of 1956), to be a University for the purposes of that Act.]
[(2B) Where
an assessee who receives any income chargeable under the head “Salaries” has,
in addition, any income chargeable under any other head of income (not being a
loss under any such head other than the loss under the head “Income from house
property”) for the same financial year, he may send to the person responsible
for making the payment referred to in sub-section (1) the particulars of—
(a) such other income and of any tax deducted thereon under any
other provision of this Chapter;
(b) the loss, if any, under the head “Income from house property”,
in such form and verified in such manner as may be prescribed, and
thereupon the person responsible as aforesaid shall take—
(i) such other income and tax, if any, deducted thereon; and
(ii) the loss, if any, under the head “Income from house property”,
also into account for the purposes of making the deduction under
sub-section (1) :
Provided that this sub-section
shall not in any case have the effect of reducing the tax deductible except
where the loss under the head “Income from house property” has been taken
into account, from income under the head “Salaries” below the amount that would
be so deductible if the other income and the tax deducted thereon had not been
taken into account.]
[(2C) A person responsible for paying any
income chargeable under the head “Salaries” shall furnish to the person to whom
such payment is made a statement giving correct and complete particulars of
perquisites or profits in lieu of salary provided to him and the value thereof
in such form and manner as may be prescribed.]
(3) The
person responsible for making the payment referred to in sub-section (1) [or sub-section (1A)] [or sub-section (2) or sub-section (2A) or
sub-section (2B)] may, at the time of making any deduction, increase or reduce
the amount to be deducted under this section for the purpose of adjusting any
excess or deficiency arising out of any previous deduction or failure to deduct
during the financial year.
(4) The
trustees of a recognised provident fund, or any person authorised by the
regulations of the fund to make payment of accumulated balances due to
employees, shall, in cases where sub-rule (1) of rule 9 of Part A of the Fourth
Schedule applies, at the time an accumulated balance due to an employee is
paid, make therefrom the deduction provided in rule 10 of Part A of the Fourth
Schedule.
(5) Where
any contribution made by an employer, including interest on such contributions,
if any, in an approved superannuation fund is paid to the employee, [tax] on
the amount so paid shall be deducted by the trustees of the fund to the extent
provided in rule 6 of Part B of the Fourth Schedule.
(6) For the
purposes of deduction of tax on salary payable in foreign currency, the value
in rupees of such salary shall be calculated at the prescribed rate of
exchange.
[***]
193. The
person responsible for paying [to a resident] any income [by way of interest on
securities] shall, [at the time of credit of such income to the account of the
payee or at the time of payment thereof in cash or by issue of a cheque or
draft or by any other mode, whichever is earlier], deduct income-tax [***] at
the rates in force on the amount of the interest payable :
[***]
[Provided
[***] that no tax shall be deducted from—
(i) any interest payable on 4¼ per cent
National Defence Bonds, 1972, where the bonds are held by an individual, not
being a non-resident; or
[(ia) any interest payable to an individual on 4¼
per cent National Defence Loan, 1968, or 4¾ per cent National Defence Loan,
1972; or]
[(ib) any interest payable on National
Development Bonds; or]
(ii) [***]
[(iia) any interest payable on 7-Year National
Savings Certificates (IV Issue); or]
[(iib) any
interest payable on such debentures, issued by any institution or authority, or
any public sector company, or any co-operative society (including a
co-operative land mortgage bank or a co-operative land development bank), as
the Central Government may, by
notification in the Official Gazette, specify in this behalf;]
[***]]
(iii) any interest payable on 6½ per cent Gold
Bonds, 1977, or 7 per cent Gold Bonds, 1980, where the Bonds are held by an
individual not being a non-resident, and the holder thereof makes a declaration
in writing before the person responsible for paying the interest that the total
nominal value of the 6½ per cent Gold Bonds, 1977, or, as the case may be, the
7 per cent Gold Bonds, 1980, held by him (including such bonds, if any, held on
his behalf by any other person) did not in either case exceed ten thousand
rupees at any time during the period to which the interest relates;
(iiia) [* * *]
[(iv) any interest payable on any security of the Central
Government or a State Government;]
[(v) any
interest payable to an individual, who is resident in India, on debentures
issued by a company in which the public are substantially interested, being
debentures listed on a recognised stock exchange in India in accordance with
the Securities Contracts (Regulation) Act, 1956 (42 of 1956), and any rules
made thereunder, if—
(a) the interest is paid
by the company by an account payee cheque; and
(b) the amount of such interest or, as the case
may be, the aggregate of the amounts of such interest paid or likely to be paid
during the financial year by the company to such individual does not exceed [two
thousand and five hundred rupees];]
[(vi) any
interest payable to the Life Insurance Corporation of India established under
the Life Insurance Corporation Act, 1956 (31 of 1956), in respect of any
securities owned by it or in which it has full beneficial interest; or
(vii) any
interest payable to the General Insurance Corporation of India (hereafter in this
clause referred to as the Corporation) or to any of the four companies
(hereafter in this clause referred to as such company), formed by virtue of the
schemes framed under sub-section (1) of section 16 of the General Insurance
Business (Nationalisation) Act, 1972 (57 of 1972), in respect of any securities owned by the
Corporation or such company or in which the Corporation or such company has
full beneficial interest; or
(viii) any interest payable to any other insurer in respect of any
securities owned by it or in which it has full beneficial interest.]
[Explanation [***].—For
the purposes of this section, where any income by way of interest on securities
is credited to any account, whether called “Interest payable account” or
“Suspense account” or by any other name, in the books of account of the person
liable to pay such income, such crediting shall be deemed to be credit of such
income to the account of the payee and the provisions of this section shall
apply accordingly.]
Explanation 2.—[Omitted
by the Finance Act, 1992, w.e.f. 1-6-1992.]
194. The principal officer of an Indian company or
a company which has made the prescribed arrangements for the declaration and
payment of dividends (including dividends on preference shares) within India,
shall, before making any payment in cash or before issuing any cheque or
warrant in respect of any dividend or before making any distribution or payment
to a shareholder, [who is resident in India,] of any dividend within the
meaning of sub-clause (a) or sub-clause (b) or sub-clause (c)
or sub-clause (d) or sub-clause (e) of clause (22) of section
2, deduct from the amount of such
dividend, income-tax [***] at the rates in force :
[Provided that no such deduction shall be made in the
case of a shareholder, being an individual, if—
(a) the
dividend is paid by the company by an account payee cheque; and
(b) the amount
of such dividend or, as the case may be, the aggregate of the amounts of such
dividend distributed or paid or likely to be distributed or paid during the
financial year by the company to the shareholder, does not exceed [two thousand five hundred] rupees:
Provided further that the provisions of this section shall not
apply to such income credited or paid to—
(a) the Life
Insurance Corporation of India established under the Life Insurance Corporation
Act, 1956 (31 of 1956), in respect of any shares owned by it or in which it has
full beneficial interest;
(b) the
General Insurance Corporation of India (hereafter in this proviso referred to
as the Corporation) or to any of the four companies (hereafter in this proviso
referred to as such company), formed by virtue of the schemes framed under
sub-section (1) of section 16 of the General Insurance Business
(Nationalisation) Act, 1972 (57 of 1972), in respect of any shares owned by the
Corporation or such company or in which the Corporation or such company has
full beneficial interest;
(c) any
other insurer in respect of any shares owned by it or in which it has full
beneficial interest :]
[Provided also that no such deduction shall be made in
respect of any dividends referred to in section 115-O.]
[Interest other than “Interest on
securities”.
194A. (1) Any person, not being an individual or a
Hindu undivided family, who is responsible for paying to a resident any income
by way of interest other than income [by way of
interest on securities], shall, at the time of credit of such income to the
account of the payee or at the time of payment thereof in cash or by issue of a
cheque or draft or by any other mode, whichever is earlier, deduct income-tax
thereon at the rates in force :
[Provided that an individual or a Hindu undivided family, whose total sales, gross
receipts or turnover from the business or profession carried on by him exceed
the monetary limits specified under clause (a) or clause (b) of section
44AB during the financial year
immediately preceding the financial year in which such interest is credited or
paid, shall be liable to deduct income-tax under this section.]
[Explanation.—For
the purposes of this section, where any income by way of interest as aforesaid
is credited to any account, whether called “Interest payable account” or
“Suspense account” or by any other name, in the books of account of the person
liable to pay such income, such crediting shall be deemed to be credit of such
income to the account of the payee and the provisions of this section shall
apply accordingly.]
(2) [Omitted
by the Finance Act, 1992, w.e.f. 1-6-1992.]
(3) The
provisions of sub-section (1) shall not apply—
[(i) where the amount of such income or, as
the case may be, the aggregate of the amounts of such income credited or paid
or likely to be credited or paid during the financial year by the person
referred to in sub-section (1) to the account of, or to, the payee, does not
exceed [five thousand rupees]:]
[Provided
that in respect of the income credited or paid in respect of—
(a) time deposits with a banking company to which
the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or
banking institution referred to in section 51 of that Act); or
(b) time deposits with a co-operative society
engaged in carrying on the business of banking;
(c) deposits with a public company which is formed
and registered in India with the main object of carrying on the business of
providing long-term finance for construction or purchase of houses in India for
residential purposes [and which is eligible for deduction under clause (viii) of
sub-section (1) of section 36] [***],
[* * *] the aforesaid amount shall be computed
with reference to the income credited or paid by a branch of the banking
company or the co-operative society or the public company, as the case may be;]
(ii) [***]
(iii) to such income credited or paid to—
(a) any banking company to which the Banking
Regulation Act, 1949 (10 of 1949), applies, or any co-operative society engaged
in carrying on the business of banking (including a co-operative land mortgage
bank), or
(b) any financial corporation established by or
under a Central, State or Provincial Act, or
(c) the Life Insurance Corporation of India
established under the Life Insurance Corporation Act, 1956 (31 of 1956), or
(d) the Unit Trust of India established under the
Unit Trust of India Act, 1963 (52 of 1963), or
(e) any company or co-operative society carrying
on the business of insurance, or
(f) such other
institution, association or body [or class of institutions, associations or
bodies] which the Central Government may, for reasons to be recorded in
writing, notify in this behalf in the Official Gazette;
[(iv) to such income credited or paid by a firm to a partner of
the firm;]
(v) to such income credited or paid by a
co-operative society [to a member thereof or] to any other co-operative
society;]
[(vi) to such income
credited or paid in respect of deposits under any scheme framed by the Central
Government and notified by it in this behalf in the Official Gazette;
[(vii) to such income credited or paid in respect
of deposits (other than time deposits made on or after the 1st day of July,
1995) with a banking company to which the Banking Regulation Act, 1949 (10 of
1949) applies (including any bank or banking institution referred to in section
51 of that Act);
(viia) to such income credited or paid in respect
of,—
(a) deposits with a primary agricultural credit
society or a primary credit society or a co-operative land mortgage bank or a
co-operative land development bank;
(b) deposits (other than time deposits made on or
after the 1st day of July, 1995) with a co-operative society, other than a
co-operative society or bank referred to in sub-clause (a), engaged in
carrying on the business of banking;]
[(viii) to such income credited or paid by the
Central Government under any provision of this Act or the Indian Income-tax
Act, 1922 (11 of 1922), or the Estate Duty Act, 1953 (34 of 1953), or the
Wealth-tax Act, 1957 (27 of 1957), or the Gift-tax Act, 1958 (18 of 1958), or
the Super Profits Tax Act, 1963 (14 of 1963), or the Companies (Profits) Surtax
Act, 1964 (7 of 1964), or the Interest-tax Act, 1974 (45 of 1974);]
[(ix) to such income credited 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;]
[(x) to such income which is paid or payable by an infrastructure
capital company or infrastructure capital fund or a public sector company in
relation to a zero coupon bond issued on or after the 1st day of June, 2005 by
such company or fund or public sector company.]
[Explanation 1.—For the purposes of
clauses (i), (vii) and (viia), “time deposits” means
deposits (excluding recurring deposits) repayable on the expiry of fixed
periods.
Explanation 2.— [***]
[(4) The
person responsible for making the payment referred to in sub-section (1) may,
at the time of making any deduction, increase or reduce the amount to be
deducted under this section for the purpose of adjusting
any excess or deficiency arising out of any previous deduction or failure to
deduct during the financial year.]
Explanation.—[Omitted by the Finance Act, 1992, w.e.f. 1-6-1992.]
[Winnings
from lottery or crossword puzzle.
194B. The person responsible for paying to any
person any income by way of winnings from any lottery or crossword puzzle [or
card game and other game of any sort] in an amount exceeding [five
thousand rupees] shall, at the time of payment thereof, deduct income-tax
thereon at the rates in force:
[***]]
[Provided [***] that in a case where the winnings are wholly in kind or
partly in cash and partly in kind but the part in cash is not sufficient to
meet the liability of deduction of tax in respect of whole of the winnings, the
person responsible for paying shall, before releasing the winnings, ensure that
tax has been paid in respect of the winnings.]
194BB. Any person, being a bookmaker or a person to
whom a licence has been granted by the Government under any law for the time
being in force for horse racing in any race course or for arranging for
wagering or betting in any race course, who is responsible for paying to any
person any income by way of winnings from any horse race in an amount exceeding
[two thousand five hundred rupees] shall, at the time of payment thereof,
deduct income-tax thereon at the rates in force.
[***]]
[Payments
to contractors and sub-contractors.
194C. (1) Any person responsible for paying any sum to any resident(hereafter
in this section referred to as the contractor) for carrying out any work
(including supply of labour for carrying out any work) in pursuance of a
contract between the contractor and—
(a) the Central Government or any State Government; or
(b) any local authority; or
(c) any corporation established by or under a Central, State or
Provincial Act; or
(d) any company; [or]
[(e) any co-operative [society; or]]
[(f) any
authority, constituted in India by or under any law, engaged either for the
purpose of dealing with and satisfying the need for housing accommodation or
for the purpose of planning, development or improvement of cities, towns and
villages, or for both; or
(g) any society registered under the Societies Registration Act,
1860 (21 of 1860) or under any law corresponding to that Act in force in any
part of India; or
(h) any trust; or
(i) any University established or incorporated by or under a Central,
State or Provincial Act and an institution declared to be a University under
section 3 of the University Grants Commission Act, 1956 (3 of 1956); 5[or]
[(j) any firm,]
shall, at the time
of credit of such sum to the account of the contractor or at the time of
payment thereof in cash or by issue of a cheque or draft or by any other mode,
whichever is earlier, [deduct an amount equal to—
(i) one per cent in case of advertising,
(ii) in any other case two per cent,
of such sum
as income-tax on income comprised therein.]
(2) Any
person (being a contractor and not being an individual or a Hindu undivided
family) responsible for paying any sum to any resident (hereafter in this
section referred to as the sub-contractor) in pursuance of a contract with the
sub-contractor for carrying out, or for the supply of labour for carrying out,
the whole or any part of the work undertaken by the contractor or for supplying
whether wholly or partly any labour which the contractor has undertaken to
supply shall, at the time of credit of such sum to the account of the
sub-contractor or at the time of payment thereof in cash or by issue of a
cheque or draft or by any other mode, whichever is earlier, deduct an amount
equal to one per cent of such sum as income-tax on income comprised therein:
[Provided that an individual or a Hindu undivided
family, whose total sales, gross receipts or turnover from the business or
profession carried on by him exceed the monetary limits specified under clause
(a) or clause (b) of section 44AB during the financial year immediately preceding the financial year in
which such sum is credited or paid to the account of the sub-contractor, shall be liable to
deduct income-tax under this sub-section.]
[Explanation
I.—For the purposes of sub-section (2), the expression “contractor” shall
also include a contractor who is carrying out any work (including supply of
labour for carrying out any work) in pursuance of a contract between the
contractor and the Government of a foreign State or a foreign enterprise or any
association or body established outside India.]
[[Explanation
II].—For the purposes of this section, where any sum referred to in
sub-section (1) or sub-section (2) is credited to any account, whether called
“Suspense account” or by any other name, in the books of account of the person
liable to pay such income, such crediting shall be deemed to be credit of such
income to the account of the payee and the provisions of this section shall
apply accordingly.]
[Explanation
III.—For the purposes of this section, the
expression “work” shall also include—
(a) advertising;
(b) broadcasting and telecasting including production of
programmes for such broadcasting or telecasting;
(c) carriage of goods and passengers by any mode of transport
other than by railways;
(d) catering.]
(3) No
deduction shall be made under sub-section (1) or sub-section (2) from—
[(i) the amount of any sum credited or paid or
likely to be credited or paid to the account of, or to, the contractor or
sub-contractor, if such sum does not exceed twenty thousand rupees:
Provided that where the
aggregate of the amounts of such sums credited or paid or likely to be credited
or paid during the financial year exceeds fifty thousand rupees, the person responsible
for paying such sums referred to in sub-section (1) or, as the case may be,
sub-section (2) shall be liable to deduct income-tax [under this section:]
[Provided
further that no deduction shall be made under sub-section
(2), from the amount of any sum credited or paid or likely to be credited or
paid during the previous year to the account of the sub-contractor during the
course of business of plying, hiring or leasing goods carriages, on production
of a declaration to the person concerned paying or crediting such sum, in the
prescribed form and verified in the prescribed manner and within such time as
may be prescribed, if such sub-contractor is an individual who has not owned
more than two goods carriages at any time during the previous year:
Provided also that the person
responsible for paying any sum as aforesaid to the sub-contractor referred to
in the second proviso shall furnish to the prescribed income-tax authority or
the person authorised by it such particulars as may be prescribed in such form
and within such time as may be prescribed; or]
(ii) any sum credited or paid before the
1st day of June, 1972; [or]
[(iii) any
sum credited or paid before the 1st day of June, 1973, in pursuance of a
contract between the contractor and a co-operative society or in pursuance of a
contract between such contractor and the sub-contractor in relation to any work
(including supply of labour for carrying out any work) undertaken by the
contractor for the co-operative society.]
[Explanation.—for the purposes of
clause (i), “goods carriage” shall have the same meaning as in the Explanation
to sub-section (7) of section 44AE.]
(4) [***]
(5) [***]]
194D. Any person responsible for paying to a resident any income by way of
remuneration or reward, whether by way of commission or otherwise, for
soliciting or procuring insurance business (including business relating to the
continuance, renewal or revival of policies of insurance) shall, at the time of
credit of such income to the account of the payee or at the time of payment
thereof in cash or by issue of a cheque or draft or by any other mode,
whichever is earlier, deduct income-tax thereon at the rates in force :
Provided that
no deduction shall be made under this section from any such income credited or
paid before the 1st day of June, 1973:]
[Provided
further that no deduction
shall be made under this section in a case where the amount of such income or,
as the case may be, the aggregate of the amounts of such income credited or
paid or likely to be credited or paid during the financial year to the account
of, or to, the payee, does not exceed five thousand rupees.]
[Payments
to non-resident sportsmen or sports associations.
194E. Where
any income referred to in section 115BBA is payable to a non-resident sportsman
(including an athlete) who is not a citizen of India or a non-resident sports
association or institution, the person responsible for making the payment
shall, at the time of credit of such income to the account of the payee or at
the time of payment thereof in cash or by issue of a cheque or draft or by any
other mode, whichever is earlier, deduct income-tax thereon at the rate of ten
per cent.]
[Payments
in respect of deposits under National Savings Scheme, etc.
194EE. The person responsible for paying to any
person any amount referred to in clause (a) of sub-section (2) of
section 80CCA shall, at the time of payment thereof, deduct income-tax thereon
at the rate of twenty per cent :
Provided that
no deduction shall be made under this section where the amount of such payment
or, as the case may be, the aggregate amount of such payments to the payee
during the financial year is less than two thousand five hundred rupees :
Provided further
that nothing contained in this section shall apply to the payment of the said
amount to the heirs of the assessee.]
[Payments
on account of repurchase of units by Mutual Fund or Unit Trust of India.
194F. The
person responsible for paying to any person any amount referred to in
sub-section (2) of section 80CCB shall, at the time of payment thereof, deduct
income-tax thereon at the rate of twenty per cent.]
[Commission, etc., on the sale of lottery tickets.
194G. [(1)] Any person who is responsible for
paying, on or after the 1st day of October, 1991 to any person, who is or has
been stocking, distributing, purchasing or selling lottery tickets, any income
by way of commission, remuneration or prize (by whatever name called) on such
tickets in an amount exceeding one thousand rupees shall, at the time of credit
of such income to the account of the payee or at the time of payment of such
income in cash or by the issue of a cheque or draft or by any other mode,
whichever is earlier, deduct income-tax thereon at the rate of ten per cent.
(2) [***]
(3) [***]
Explanation.—For the purposes of this section, where any income
is credited to any account, whether called “Suspense Account” or by any other
name, in the books of account of the person liable to pay such income, such
crediting shall be deemed to be credit of such income to the account of the
payee and the provisions of this section shall apply accordingly.]
194H. Any person, not being an individual or a Hindu undivided family, who is responsible for paying, on or after the 1st day of June, 2001, to a resident, any income by way of commission (not being insurance commission referred to in section 194D or brokerage, shall, at the time of credit of such income to the account of the payee or at the time of payment of such income in cash or by the issue of a cheque or draft or by any other mode, whichever is earlier, deduct income-tax thereon at the rate of [five] per cent :
Provided that no deduction shall be made under this section in a case where the
amount of such income or, as the case may be, the aggregate of the amounts of
such income credited or paid or likely to be credited or paid during the
financial year to the account of, or to, the payee, does not exceed two
thousand five hundred rupees :
[Provided further that an individual or a Hindu undivided family, whose total sales, gross
receipts or turnover from the business or profession carried on by him exceed
the monetary limits specified under clause (a) or clause (b) of
section 44AB during the financial year immediately preceding the financial year
in which such commission or brokerage is credited or paid, shall be liable to
deduct income-tax under this section.]
Explanation.—For the purposes of this section,—
(i) “commission or brokerage” includes any payment
received or receivable, directly or indirectly, by a person acting on behalf of
another person for services rendered (not being professional services) or for
any services in the course of buying or selling of goods or in relation to any
transaction relating to any asset, valuable article or thing, not being securities;
(ii) the expression “professional services”
means services rendered by a person in the course of carrying on a legal,
medical, engineering or architectural profession or the profession of
accountancy or technical consultancy or interior decoration or such other
profession as is notified by the Board for the purposes of section 44AA;
(iii) the expression “securities” shall have the meaning assigned to it in clause (h) of section 2 of the Securities Contracts (Regulation) Act, 1956 (42 of 1956) ;
(iv) where any income is credited to any
account, whether called “Suspense account” or by any other name, in the books
of account of the person liable to pay such income, such crediting shall be
deemed to be credit of such income to the account of the payee and the
provisions of this section shall apply accordingly.]
194-I. Any person, not being an individual or a Hindu
undivided family, who is responsible for paying to [a resident] any income by
way of rent shall, at the time of credit of such income to the account of the
payee or at the time of payment thereof in cash or by the issue of a cheque or
draft or by any other mode, whichever is earlier, [deduct income-tax thereon at
the rate of—
(a) fifteen per cent if the payee is an individual or a Hindu
undivided family; and
(b) twenty per cent in other cases :]
Provided that no deduction shall be made under this
section where the amount of such income or, as the case may be, the aggregate
of the amounts of such income credited or paid or likely to be credited or paid
during the financial year by the aforesaid person to the account of, or to, the
payee, does not exceed one hundred and twenty thousand rupees :
[Provided further that an individual or
a Hindu undivided family, whose total sales, gross receipts or turnover from
the business or profession carried on by him exceed the monetary limits
specified under clause (a) or clause (b) of section 44AB during the financial year immediately
preceding the financial year in which such income by way of rent is credited or
paid, shall be liable to deduct income-tax under this section.]
Explanation.—For the purposes of this section,—
[(i) “rent”
means any payment, by whatever name called, under any lease, sub-lease, tenancy
or any other agreement or arrangement for the use of (either separately or
together) any,—
(a) land;
or
(b) building
(including factory building); or
(c) land
appurtenant to a building (including factory building); or
(d) machinery;
or
(e) plant; or
(f) equipment; or
(g) furniture;
or
(h) fittings,
whether or not any or all of
the above are owned by the payee;]
(ii) where any income is credited to any account, whether called
“Suspense account” or by any other name, in the books of account of the person
liable to pay such income, such crediting shall be deemed to be credit of such
income to the account of the payee and the provisions of this section shall
apply accordingly.]
[Fees
for professional or technical services.
194J. (1) Any person, not being an individual or a
Hindu undivided family, who is responsible for paying to a resident any sum by
way of—
(a) fees for professional services, or
(b) fees for technical services, [or]
[(c) royalty, or
(d) any
sum referred to in clause (va) of section 28,]
shall, at
the time of credit of such sum to the account of the payee or at the time of
payment thereof 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 on income comprised therein :
Provided that no deduction
shall be made under this section—
(A) from any sums as aforesaid credited or paid before the 1st day
of July, 1995; or
(B) where the amount of such sum or, as the case may be, the
aggregate of the amounts of such sums credited or paid or likely to be credited
or paid during the financial year by the aforesaid person to the account of, or
to, the payee, does not exceed—
(i) twenty thousand rupees, in the case of fees
for professional services referred to in clause (a), or
(ii) twenty thousand rupees, in the case of fees for technical services referred to in [clause (b), or]
[(iii) twenty thousand rupees, in the case of royalty
referred to in clause (c), or
(iv) twenty
thousand rupees, in the case of sum referred to in clause (d) :]
[Provided further that an individual or a Hindu undivided family, whose total sales, gross
receipts or turnover from the business or profession carried on by him exceed
the monetary limits specified under clause (a) or clause (b) of
section 44AB during the financial year immediately preceding the financial year
in which such sum by way of fees for professional services or technical
services is credited or paid, shall be liable to deduct income-tax under this section :]
[Provided also that no individual or a Hindu undivided family referred to in the second
proviso shall be liable to deduct income-tax on the sum by way of fees for
professional services in case such sum is credited or paid exclusively for
personal purposes of such individual or any member of Hindu undivided family.]
(2)[***]
(3) [***]
Explanation.—For the purposes of this section,—
(a) “professional services” means services rendered by a person
in the course of carrying on legal, medical, engineering or architectural
profession or the profession of accountancy or technical consultancy or
interior decoration or advertising or such other profession as is notified by
the Board for the purposes of section 44AA or of this section;
(b) “fees for technical services” shall have the same meaning as
in Explanation 2 to clause (vii) of sub-section (1) of section 9;
[(ba) “royalty”
shall have the same meaning as in Explanation 2 to clause (vi)
of sub-section (1) of section 9;]
(c) where any sum referred to in sub-section (1) is credited to
any account, whether called “suspense account” or by any other name, in the
books of account of the person liable to pay such sum, such crediting shall be
deemed to be credit of such sum to the account of the payee and the provisions
of this section shall apply accordingly.
194K. Where any income is payable to a resident in respect of units of a
Mutual Fund specified under clause (23D) of section 10 or of the Unit Trust of India, the person
responsible for making the payment shall, at the time of credit of such income
to the account of payee or at the time of payment thereof in cash or by issue
of a cheque or draft or by any other mode, whichever is earlier, deduct
income-tax thereon at the rate of ten per cent :
Provided that the provisions of this section shall not apply where the amount of such income or, as the case may be, the aggregate of the amounts of such income credited or paid or likely to be credited or paid during the financial year by the person responsible for making the payment to the account of, or to, the payee does not exceed [two thousand five hundred] rupees :
Provided further that the amount of one thousand rupees
shall be computed with reference to the income credited or paid—
(a) in respect of a branch office of the Mutual Fund or of the
Unit Trust of India, as the case may be, and
(b) under a
particular scheme under which the units have been issued :
[Provided
also that no deduction shall be made under this
section from any such income credited or paid on or after the 1st day of April,
2003.]
Explanation.—For the purposes of this section,—
(a) “Unit Trust of
India” means the Unit Trust of India established under the Unit Trust of India
Act, 1963 (52 of 1963);
(b) where any income
as aforesaid is credited to any account, whether called “Suspense account” or
by any other name, in the books of account of the person liable to pay such
income, such crediting shall be deemed to be credit of such income to the
account of the payee and the provisions of this section shall apply
accordingly.]
[Payment of compensation on acquisition of capital asset.
194L. Any person responsible for paying to a resident any sum being in the
nature of compensation or the enhanced compensation or the consideration or the
enhanced consideration on account of compulsory acquisition, under any law for
the time being in force, of any capital asset shall, 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 ten per cent of such sum as income-tax
on income comprised therein :
Provided that no deduction shall be made under this
section where the amount of such payment or, as the case may be, the aggregate
amount of such payments to a resident during the financial year does not exceed
one hundred thousand rupees:]
[Provided
further that no deduction shall be made under this
section from any payment made on or after the 1st day of June, 2000.]
[Payment of compensation on
acquisition of certain immovable property.
194LA.
Any person responsible
for paying to a resident any sum, being in the nature of compensation or the
enhanced compensation or the consideration or the enhanced consideration on
account of compulsory acquisition, under any law for the time being in force, of
any immovable property (other than agricultural land), shall, 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 ten per cent of such sum
as income-tax thereon:
Provided that no deduction shall be made under this
section where the amount of such payment or, as the case may be, the aggregate
amount of such payments to a resident during the financial year does not exceed
one hundred thousand rupees.
Explanation.—For the purposes of this section,—
(i) “agricultural land” means agricultural land in India
including land situate in any area referred to in items (a) and (b)
of sub-clause (iii) of clause (14) of section 2;
(ii) “immovable property” means any land (other than agricultural
land) or any building or part of a building.]
195. [(1) Any person responsible for paying to a
non-resident, not being a company, or to a foreign company, any interest [***]
or any other sum chargeable under the provisions of this Act (not being income
chargeable under the head “Salaries” [***]) shall, at the time of credit of
such income to the account of the payee or at the time of payment thereof in
cash or by the issue of a cheque or draft or by any other mode, whichever is
earlier, deduct income-tax thereon at the rates in force :
[Provided that in the case of interest payable by the
Government or a public sector bank within the meaning of clause (23D) of
section 10 or a public financial
institution within the meaning of that clause, deduction of tax shall be made
only at the time of payment thereof in cash or by the issue of a cheque or
draft or by any other mode :]
[Provided further that no such deduction shall be made in
respect of any dividends referred to in section 115-O.]
Explanation.—For the purposes of this section, where any
interest or other sum as aforesaid is credited to any account, whether called
“Interest payable account” or “Suspense account” or by any other name, in the
books of account of the person liable to pay such income, such crediting shall
be deemed to be credit of such income to the account of the payee and the
provisions of this section shall apply accordingly.]
(2) Where the person responsible for paying any such sum chargeable under this Act (other than [***] [***] [***] [***] salary) to a non-resident considers that the whole of such sum would not be income chargeable in the case of the recipient, he may make an application to the [Assessing] Officer to determine, [by general or special order], the appropriate proportion of such sum so chargeable, and upon such determination, tax shall be deducted under sub-section (1) only on that proportion of the sum which is so chargeable.
[***]
[(3) Subject
to rules made under sub-section (5), any person entitled to receive any
interest or other sum on which income-tax has to be deducted under sub-section
(1) may make an application in the prescribed form to the [Assessing] Officer
for the grant of a certificate authorising him to receive such interest or
other sum without deduction of tax under that sub-section, and where any such
certificate is granted, every person responsible for paying such interest or
other sum to the person to whom such certificate is granted shall, so long as
the certificate is in force, make payment of such interest or other sum without
deducting tax thereon under sub-section (1).
(4) A certificate granted under sub-section (3) shall remain in force till the expiry of the period specified therein or, if it is cancelled by the [Assessing] Officer before the expiry of such period, till such cancellation.
(5) The
Board may, having regard to the convenience of assessees and the interests of
revenue, by notification in the Official Gazette, make rules specifying the
cases in which, and the circumstances under which, an application may be made
for the grant of a certificate under sub-section (3) and the conditions subject
to which such certificate may be granted and providing for all other matters
connected therewith.]
195A. [In a case other than that referred to in sub-section (1A) of section 192, where under an agreement] or other arrangement, the tax chargeable on any income referred to in the foregoing provisions of this Chapter is to be borne by the person by whom the income is payable, then, for the purposes of deduction of tax under those provisions such income shall be increased to such amount as would, after deduction of tax thereon at the rates in force for the financial year in which such income is payable, be equal to the net amount payable under such agreement or arrangement.]
[Interest or dividend or
other sums payable to Government, Reserve Bank or certain corporations.
196. Notwithstanding
anything contained in the foregoing provisions of this Chapter, no deduction of
tax shall be made by any person from any sums payable to—
(i) the Government, or
(ii) the Reserve Bank of India, or
(iii) a corporation established by or under a
Central Act which is, under any law for the time being in force, exempt from
income-tax on its income, or
(iv) a Mutual Fund specified under clause
(23D) of section 10,
where such
sum is payable to it by way of interest or dividend in respect of any
securities or shares owned by it or in which it has full beneficial interest,
or any other income accruing or arising to it.]
[Income
in respect of units of non-residents.
196A. (1) Any
person responsible for paying to a non-resident, not being a company, or to a
foreign company, any income in respect of units of a Mutual Fund specified
under clause (23D) of section 10 or of the Unit Trust of India shall, at the time of credit of such
income to the account of the payee or at the time of payment thereof in cash or
by the issue of a cheque or draft or by any other mode, whichever is earlier,
deduct income-tax thereon at the rate of twenty per cent :
[Provided that no deduction shall be made under this section from any such income
credited or paid on or after the 1st day of April, 2003.]
(2)
Notwithstanding anything contained in sub-section (1), no deduction of tax
shall be made from any income payable in respect of units of the Unit Trust of
India to a non-resident Indian or a non-resident Hindu undivided family, where
the units have been acquired from the Unit Trust of India out of the funds in a
Non-resident (External) Account maintained with any bank in India or by
remittance of funds in foreign currency, in accordance, in either case, with
the provisions of the Foreign Exchange Regulation Act, 1973 (46 of 1973), and
the rules made thereunder.
Explanation.—For the purposes of this section—
(a) “foreign currency” shall have the meaning assigned to it in the Foreign Exchange Regulation Act, 1973 (46 of 1973);
(b) “non-resident Indian” shall have the meaning assigned to it
in clause (e) of section 115C;
(c) “Unit Trust of India” means the Unit Trust of India established
under the Unit Trust of India Act, 1963 (52 of 1963);
(d) where any income as aforesaid is credited to any account,
whether called “Suspense account” or by any other name, in the books of account
of the person liable to pay such income, such crediting shall be deemed to be
credit of such income to the account of the payee and the provisions of this
section shall apply accordingly.]
196B. [Where any income in respect of units referred to in section 115AB or by way of long-term capital gains arising from the transfer of such units is payable to an Offshore Fund], the person responsible for making the payment shall, at the time of credit of such income to the account of the payee or at the time of payment thereof in cash or by the issue of a cheque or draft or by any other mode, whichever is earlier, deduct income-tax thereon at the rate of ten per cent.]
[Income from foreign currency bonds or shares87
of Indian company.
196C. [Where any income by way of interest or dividends in respect of [bonds or Global Depository Receipts] referred to in section 115ACor by way of long-term capital gains arising from the transfer of such [bonds or Global Depository Receipts] is payable to a non-resident], the person responsible for making the payment shall, at the time of credit of such income to the account of the payee or at the time of payment thereof in cash or by the issue of a cheque or draft or by any other mode, whichever is earlier, deduct income-tax thereon at the rate of ten per cent :
[Provided that no such deduction shall be made in respect of
any dividends referred to in section 115-O.]
[Income
of Foreign Institutional Investors from securities.
196D. (1)
Where any income in respect of securities referred to in clause (a) of
sub-section (1) of section 115AD
is payable to a Foreign Institutional Investor, the person responsible for
making the payment shall, at the time of credit of such income to the account of
the payee or at the time of payment thereof in cash or by issue of a cheque or
draft or by any other mode, whichever is earlier, deduct income-tax thereon at
the rate of twenty per cent :
[Provided that no such deduction shall be made in respect of any dividends
referred to in section 115-O.]
(2) No
deduction of tax shall be made from any income, by way of capital gains arising
from the transfer of securities referred to in section 115AD, payable to a Foreign Institutional
Investor.]
Certificate
for deduction at lower rate.
197. (1) [Subject to rules made under sub-section (2A), [where, in the case of any income of any person [or sum payable to any person], income-tax is required to be deducted at the time of credit or, as the case may be, at the time of payment at the rates in force under the provisions of sections 192, 193, [194,] 194A, [194C,] 194D, [194G] [,194H [, 194-I] [, 194J] , 194K] [***] [, 194LA] and 195, the Assessing Officer is satisfied] that the total income [***] of the recipient justifies the deduction of income-tax [***] at any lower rates or no deduction of income-tax [***], as the case may be, the [Assessing] Officer shall, on an application made by the assessee in this behalf, give to him such certificate as may be appropriate.
(2) Where any such certificate is given, the person responsible for paying the income shall, until such certificate is cancelled by the [Assessing] Officer, deduct income-tax [***] at the rates specified in such certificate or deduct no tax, as the case may be.
[(2A) The
Board may, having regard to the convenience of assessees and the interests of
revenue, by notification in the Official Gazette, make rules specifying the
cases in which, and the circumstances under which, an application may be made
for the grant of a certificate under sub-section (1) and the conditions subject
to which such certificate may be granted and providing for all other matters
connected therewith.]
(3) [***]
[No
deduction to be made in certain cases.
197A. (1) Notwithstanding anything contained in [***]
section 194[***] [or section
194EE], no deduction of tax shall be
made under any of the said sections in the case of an individual, who is
resident in India, if such individual furnishes to the person responsible for
paying any income of the nature referred to in [***] section 194 [[***] or, as the case may be, section
194EE], a declaration in writing in
duplicate in the prescribed form and verified in the prescribed manner to the
effect that [the tax on his estimated total income of the previous year in
which such income is to be included in computing his total income will be nil.]
[(1A)
Notwithstanding anything contained in [section 193 or] section 194A or section 194K, no deduction of tax shall be made under [any] of the said sections in
the case of a person (not being a company or a firm), if such person furnishes
to the person responsible for paying any income of the nature referred to in [section
193 or] section 194A or section 194K, as the case may be, a declaration in writing in duplicate in the
prescribed form and verified in the prescribed manner to the effect that the
tax on his estimated total income of the previous year in which such income is
to be included in computing his total income will be nil.]
[(1B) The provisions of this section shall not
apply where the amount of any income of the nature referred to in sub-section
(1) or sub-section (1A), as the case may be, or the aggregate of the amounts of
such incomes credited or paid or likely to be credited or paid during the
previous year in which such income is to be included exceeds the maximum amount
which is not chargeable to income-tax.]
[(1C) Notwithstanding anything contained in section 193 or section 194
or section 194A or section 194EE or section 194K or sub-section (1B) of this
section, no deduction of tax shall be made in the case of an individual
resident in India, who is of the age of sixty-five years or more at any time
during the previous year and is entitled to a deduction from the amount of
income-tax on his total income referred to in section 88B * if such
individual furnishes to the person responsible for paying any income of the
nature referred to in section 193 or section 194 or section 194A or section
194EE or section 194K, as the case may be, a declaration in writing in
duplicate in the prescribed form nd verified in the prescribed manner to the
effect that the tax on his estimated total income of the previous year in which
such income is to be included in computing his total income will be nil.]
[(1D) Notwithstanding anything contained in this section, no
deduction of tax shall be made by the Offshore Banking Unit from the interest
paid—
(a) on deposit made on or after the 1st
day of April, 2005, by a non-resident or a person not ordinarily resident in
India; or
(b) on borrowing, on or after the 1st day
of April, 2005, from a non-resident or a person not ordinarily resident in
India.
Explanation.—For the purposes of this
sub-section “Offshore Banking Unit” shall have the same meaning as assigned to
it in clause (u) of section 2 of the Special Economic Zones Act, 2005.]
(2) The person responsible for paying any income of the nature referred to in sub-section (1) [or sub-section (1A)] [or sub-section (1C)] shall deliver or cause to be delivered to the [Chief Commissioner or Commissioner] one copy of the declaration referred to in sub-section (1) [or sub-section (1A)] [or sub-section (1C)] on or before the seventh day of the month next following the month in which the declaration is furnished to him.]
Tax deducted
is income received.
198. All sums deducted in accordance with [the foregoing provisions of this Chapter] shall, for the purpose of computing the income of an assessee, be deemed to be income received:
[Provided that the sum being the tax paid, under
sub-section (1A) of section 192
for the purpose of computing the income of an assessee,
shall not be deemed to be income received.]
199. [(1)]
Any deduction made in accordance with [the foregoing provisions of this
Chapter] and paid to the Central Government shall be treated as a payment of [tax]
on behalf of the person from whose income the deduction was made, or of the
owner of the security [, or depositor or owner of property or of unit-holder]
or of the shareholder, as the case may be, and credit shall be given to him for
the amount so deducted on the production of the certificate furnished under section
203 in the assessment [***] [made under this Act for the assessment year
for which such income is assessable] :
[Provided
that—
(i) in a case where such person or owner [or depositor or unit-holder] or shareholder is a person, whose income is included under the provisions of section 60, section 61, section 64 section 93 or section 94 in the total income of another person, the payment shall be deemed to have been made on behalf of, and the credit shall be given to, such other person;
(ii) in any other case, where the dividend on any share is
assessable as the income of a person other than the shareholder, the payment
shall be deemed to have been made on behalf of, and the credit shall be given
to, such other person in such circumstances as may be prescribed :
[Provided
further that where any property, deposit, security,
unit or share is owned jointly by two or more persons not constituting a
partnership, the payment shall be deemed to have been made on behalf of, and credit
shall be given to, each such person in the same proportion in which rent,
interest on deposit or on security or income in respect of unit or dividend on
share is assessable as his income.]]
[(2) Any sum referred to in
sub-section (1A) of section 192
and paid to the Central Government shall be treated as the tax paid on behalf
of the person in respect of whose income, such payment of tax has been made and
credit shall be given to him for the amount so paid on production of the
certificate furnished under section 203 in the assessment under this Act for the assessment year for which such
income is assessable.]
[(3) Where any
deduction is made in accordance with the foregoing provisions of this Chapter
on or after the 1st day of April, [2008] and paid to the
Central Government, the amount of tax deducted and specified in the statement
referred to in section 203AA shall be treated as tax paid on behalf of the
persons referred to in sub-section (1) or, as the case may be, sub-section (2)
and credit shall be given to him for the amount so deducted in the assessment
made under this Act for the assessment year for which such income is assessable
without the production of certificate.]
200. [(1)] Any person deducting any sum in accordance with [the foregoing provisions of this Chapter] shall pay within the prescribed time, the sum so deducted to the credit of the Central Government or as the Board directs.
[(2) Any person being an employer,
referred to in sub-section (1A) of section 192 shall pay, within the prescribed time, the tax to the credit of the
Central Government or as the Board directs.]
[(3) Any
person deducting any sum on or after the 1st day of April, 2005 in accordance
with the foregoing provisions of this Chapter or, as the case may be, any
person being an employer referred to in sub-section (1A) of section 192 shall,
after paying the tax deducted to the credit of the Central Government within
the prescribed time, prepare quarterly statements for the period ending on the
30th June, the 30th September, the 31st December and the 31st March in each
financial year and deliver or cause to be delivered to the prescribed
income-tax authority or the person authorised by such authority such statement
in such form and verified in such manner and setting forth such particulars and
within such time as may be prescribed.]
Consequences of failure to deduct or pay.
201. (1) If any such person [referred to in section 200] and in the cases referred to in section 194, the principal officer and the company of which he is the principal officer does not deduct [the whole or any part of the tax] or after deducting fails to pay the tax as required by or under this Act, he or it shall, without prejudice to any other consequences which he or it may incur, be deemed to be an assessee in default in respect of the tax :
Provided that no penalty shall be charged under section 221 from such person, principal officer or company unless the [Assessing] Officer is satisfied that such person or principal officer or company, as the case may be, has [without good and sufficient reasons] failed to deduct and pay the tax.
[(1A) Without
prejudice to the provisions of sub-section (1), if any such person, principal
officer or company as is referred to in that sub-section does not deduct [the
whole or any part of the tax] or after deducting fails to pay the tax as
required by or under this Act, he or it shall be liable to pay simple interest
at [twelve] 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 [and
such interest shall be paid before furnishing the quarterly statement for each
quarter in accordance with the provisions of sub-section (3) of section
200].]
(2) Where the tax has not been paid as aforesaid after it is deducted, [the amount of the tax together with the amount of simple interest thereon referred to in sub-section (1A)] shall be a charge upon all the assets of the person, or the company, as the case may be, referred to in sub-section (1).
Deduction only one mode of recovery.
202. The power to [recover] tax by deduction under [the foregoing provisions of this Chapter] shall be without prejudice to any other mode of recovery.
[Certificate for tax deducted.
203. [(1)] Every person deducting tax in accordance with [the foregoing
provisions of this Chapter] [shall, within such period as may be prescribed
from the time of credit or payment of the sum, or, as the case may be, from the
time of issue of a cheque or warrant for payment of any dividend to a
shareholder], furnish to the person to whose account such credit is given or to
whom such payment is made or the cheque or warrant is issued, a certificate to
the effect that tax has been deducted, and specifying the amount so deducted,
the rate at which the tax has been deducted and such other particulars as may
be prescribed.]
[(2) Every person, being an employer, referred to in sub-section (1A) of
section 192 shall, within such period, as may be prescribed, furnish to the
person in respect of whose income such payment of tax has been made, a
certificate to the effect that tax has been paid to the Central Government, and
specify the amount so paid, the rate at which the tax has been paid and such
other particulars as may be prescribed.]
[(3) Where the
tax has been deducted or paid in accordance with the foregoing provisions of
this Chapter on or after the 1st day of April, [2008],
there shall be no requirement to furnish a certificate referred to in
sub-section (1) or, as the case may be, sub-section (2).]
[Tax deduction and collection account number.
203A. (1) Every person, deducting tax or collecting tax in accordance with the provisions of this Chapter, who has not been allotted a tax deduction account number or, as the case may be, a tax collection account number, shall, within such time as may be prescribed, apply to the Assessing Officer for the allotment of a “tax deduction and collection account number”.
(2) Where a
“tax deduction account number” or, as the case may be, a “tax collection
account number” or a “tax deduction and collection account number” has been
allotted to a person, such person shall quote such number—
(a) in all challans for the payment of
any sum in accordance with the provisions of section 200 or sub-section (3) of
section 206C;
(b) in all certificates furnished under section 203 or
sub-section (5) of section 206C;
[(ba) in all the
quarterly statements prepared and delivered or caused to be delivered in
accordance with the provisions of sub-section (3) of section 200 or sub-section
(3) of section 206C;]
(c) in all the returns, delivered in accordance with the
provisions of section 206 or sub-section (5A) or sub-section (5B) of section
206C to any income-tax authority; and
(d) in all other documents pertaining to such transactions as may
be prescribed in the interests of revenue.]
[Furnishing of statement of tax deducted.
203AA. The prescribed income-tax authority or the
person authorised by such authority referred to in sub-section (3) of section
200, shall, within the prescribed time after the end of each financial year
beginning on or after the 1st day of April, [2008]
prepare and deliver to every person from whose income the tax has been deducted
or in respect of whose income the tax has been paid a statement in the
prescribed form specifying the amount of tax deducted or paid and such other
particulars as may be prescribed.]
Meaning of “person responsible for
paying”.
204. For the purposes of [the foregoing provisions of this Chapter] and section 285, the expression “person responsible for paying” means—
(i) in the case of payments of income chargeable under the head
“Salaries”, other than payments by the Central Government or the Government of
a State, the employer himself or, if the employer is a company, the company
itself, including the principal officer thereof;
(ii) in the case of payments of income chargeable under the head
“Interest on securities”, other than payments made by or on behalf of the
Central Government or the Government of a State, the local authority,
corporation or company, including the principal officer thereof;
[(iia) in the case of any sum payable to a non-resident Indian, being any sum representing consideration for the transfer by him of any foreign exchange asset, which is not a short-term capital asset, the authorised dealer responsible for remitting such sum to the non-resident Indian or for crediting such sum to his Non-resident (External) Account maintained in accordance with the Foreign Exchange Regulation Act, 1973 (46 of 1973), and any rules made thereunder;]
(iii) [in the case of credit, or, as the case may be, payment] of any other sum chargeable under the provisions of this Act, the payer himself, or, if the payer is a company, the company itself including the principal officer thereof.
[Explanation.—For the purposes of this section,—
(a) “non-resident Indian” and “foreign exchange asset” shall have
the meanings assigned to them in Chapter XII-A;
(b) “authorised dealer” shall have the meaning assigned to it in clause (b) of section 2 of the Foreign Exchange Regulation Act, 1973 (46 of 1973).]
Bar against direct demand on assessee.
205. Where tax is deductible at the source under [the foregoing provisions of this Chapter], the assessee shall not be called upon to pay the tax himself to the extent to which tax has been deducted from that income.
[Persons deducting tax to furnish prescribed returns.
206. [(1)]
The prescribed person in the case of every office of Government, the
principal officer in the case of every company, the prescribed person in the
case of every local authority or other public body or association, every
private employer and every other person responsible for deducting tax [before
the 1st day of April, 2005] under the foregoing provisions of this
Chapter [shall, within the prescribed time after the end of each financial
year, prepare and deliver or cause to be delivered] to the prescribed
income-tax authority or such other authority or agency as may be prescribed],
such returns in such form and verified in such manner and setting forth such
particulars as may be prescribed:]
[Provided that the Board may, if it considers necessary
or expedient so to do, frame a scheme for the purposes of filing such returns
with such other authority or agency referred to in this sub-section.]
[(2) Without prejudice to the
provisions of sub-section (1), the person responsible for deducting tax under
the foregoing provisions of this Chapter other than [the prescribed person in
the case of every office of the Government and] the principal officer in the
case of every company may, at his option, deliver or cause to be delivered such
return to the prescribed income-tax authority in accordance with such scheme as
may be specified by the Board in this behalf, by notification in the Official
Gazette, and subject to such conditions as may be specified therein, on or
before the prescribed time after the end of each financial year, on a floppy,
diskette, magnetic cartridge tape, CD-ROM or any other computer readable media
(hereinafter referred to as the computer media) and in the manner as may be
specified in that scheme :
[Provided that the prescribed person in the case of
every office of Government and the principal officer in the case of every
company responsible for deducting tax under the foregoing provisions of this Chapter
shall, deliver or cause to be delivered, within the prescribed time after the
end of each financial year, such returns on computer media under the said
scheme.]
(3)
Notwithstanding anything contained in any other law for the time being in
force, a return filed on computer media shall be deemed to be a return for the
purposes of this section and the rules made thereunder and shall be admissible
in any proceedings thereunder, without further proof of production of the
original, as evidence of any contents of the original or of any fact stated
therein.
(4) Where the
Assessing Officer considers that the return delivered or caused to be delivered
under sub-section (2) is defective, he may intimate the defect to the person
responsible for deducting tax or the principal officer in the case of a
company, as the case may be, and give him an opportunity of rectifying the
defect within a period of fifteen days from the date of such intimation or
within such further period which, on an application made in this behalf, the
Assessing Officer may, in his discretion, allow; and if the defect is not
rectified within the said period of fifteen days or, as the case may be, the
further period so allowed, then, notwithstanding anything contained in any other
provision of this Act, such return shall be treated as an invalid return and
the provisions of this Act shall apply as if such person had failed to deliver
the return.]
[Furnishing
of quarterly return in respect of payment of interest to residents without
deduction of tax.
206A. (1) Any banking company or co-operative
society or public company referred to in the proviso to clause (i) of
sub-section (3) of section 194A responsible for paying to a resident any income
not exceeding five thousand rupees by way of interest (other than interest on
securities), shall prepare quarterly returns for the period ending on the 30th
June, the 30th September, the 31st December and the 31st March in each
financial year and deliver or cause to be delivered to the prescribed
income-tax authority or the person authorised by
such authority the quarterly returns as
aforesaid, in the prescribed form, verified in such manner and within such time as may be
prescribed, on a floppy, diskette, magnetic cartridge tape, CD-ROM or any other
computer readable media.
(2) The
Central Government may, by notification in the Official Gazette, require any
person other than a person mentioned in sub-section (1) responsible for paying
to a resident any income liable for deduction of tax at source under Chapter
XVII, to prepare and deliver or cause to be delivered quarterly returns in the
prescribed form and verified in such manner and within such time as may be
prescribed, to the prescribed income-tax authority or the person authorised by
such authority on a floppy, diskette, magnetic cartridge tape, CD-ROM or any
other computer readable media.]
Person paying dividend to certain
residents without deduction of tax to furnish prescribed return.
206B. [Omitted by the Finance (No. 2) Act, 1996, w.e.f. 1-10-1996.]
[BB.—Collection at source
Profits and gains from the business of
trading in alcoholic liquor, forest produce, scrap, etc.
206C. [(1) Every person, being a seller shall, at
the time of debiting of the amount payable by the buyer to the account of the
buyer or at the time of receipt of such amount from the said buyer in cash or
by the issue of a cheque or draft or by any other mode, whichever is earlier,
collect from the buyer of any goods of the nature specified in column (2) of
the Table below, a sum equal to the percentage, specified in the corresponding
entry in column (3) of the said Table, of such amount as income-tax:
[TABLE
|
SI. No |
Nature of contract or licence or lease etc. |
Percentage |
|
(1) |
(2) |
(3) |
|
(i) |
Alcoholic liquor for human consumption and tendu leaves |
Ten per cent |
|
(ii) |
Tenduleaves |
Five per cent. |
|
(iii) |
Timber obtained under a forest lease |
Two and one-half per cent. |
|
(iv) |
Timber obtained by any mode other than under a forest lease |
Two and one-half per cent. |
|
(v) |
Any other forest produce not being timber or tendu leaves |
Two and one-half per cent. |
|
(vi) |
Scrap |
one per cent :] |
[Provided
that every person, being a seller
shall at the time, during the period beginning on the 1st day of June, 2003 and
ending on the day immediately preceding the date on which the Taxation Laws
(Amendment) Act, 2003 comes into force, of debiting of the amount payable by
the buyer to the account of the buyer or of receipt of such amount from the
said buyer in cash or by the issue of a cheque or draft or by any other mode,
whichever is earlier, collect from the buyer of any goods of the nature
specified in column (2) of the Table as it stood immediately before the 1st day
of June, 2003, a sum equal to the percentage, specified in the corresponding
entry in column (3) of the said Table, of such amount as income-tax in
accordance with the provisions of this section as they stood immediately before
the 1st day of June, 2003.]]
[(1A) Notwithstanding anything
contained in sub-section (1), no collection of tax shall be made in the case of
a buyer, who is resident in India, if such buyer furnishes to the person
responsible for collecting tax, a declaration in writing in duplicate in the
prescribed form and verified in the prescribed manner to the effect that the
goods referred to in column (2) of the aforesaid Table are to be utilised for
the purposes of manufacturing, processing or producing articles or things and
not for trading purposes.
(1B) The person responsible for collecting tax
under this section shall deliver or cause to be delivered to the Chief
Commissioner or Commissioner one copy of the declaration referred to in
sub-section (1A) on or before the seventh day of the month next following the
month in which the declaration is furnished to him.]
[(1C) Every person, who grants a
lease or a licence or enters into a contract or otherwise transfers any right
or interest either in whole or in part in any parking lot or toll plaza or mine
or quarry, to another person, other than a public sector company (hereafter in
this section referred to as “licensee or lessee”) for the use of such parking
lot or toll plaza or mine or quarry for the purpose of business shall, at the
time of debiting of the amount payable by the licensee or lessee to the account
of the licensee or lessee or at the time of receipt of such amount from the
licensee or lessee in cash or by the issue of a cheque or draft or by any other
mode, whichever is earlier, collect from the licensee or lessee of any such
licence, contract or lease of the nature specified in column (2) of the Table
below, a sum equal to the percentage, specified in the corresponding entry in
column (3) of the said Table, of such amount as income-tax:
Table
|
SI. No |
Nature of contract or licence or lease etc. |
Percentage |
|
(1) |
(2) |
(3) |
|
(i) |
Parkinlot |
Two per cent |
|
(ii) |
Toll plaza |
Two per cent |
|
(iii) |
Mininig and quarrying |
Two per cent] |
(2) The power to recover tax by collection under sub-section (1) or sub-section (1C)] shall be without prejudice to any other mode of recovery.
(3) Any person collecting any amount under sub-section (1) [or sub-section (1C)] shall pay within [the prescribed time] the amount so collected to the credit of the Central Government or as the Board directs :
[Provided that the person collecting tax on or after the
1st day of April, 2005 in accordance with the foregoing provisions of this
section shall, after paying the tax collected to the credit of the Central
Government within the prescribed time, prepare quarterly statements for the
period ending on the 30th June, the 30th September, the 31st December and the
31st March in each financial year and deliver or cause to be delivered to the
prescribed income-tax authority, or the person authorised by such authority,
such statement in such form and verified in such manner and setting forth such
particulars and within such time as may be prescribed.]
(4) Any
amount collected in accordance with the provisions of this section and paid
under sub-section (3) shall be deemed as payment of tax on behalf of the person
from whom the amount has been collected and credit shall be given to him for
the amount so collected on the production of the certificate furnished under
sub-section (5) in the assessment made under this Act for the assessment year
for which such income is assessable :
[Provided that where any amount is collected in accordance with the provisions of
this section on or after the 1st day of April, [2008] and
paid under sub-section (3) to the credit of the Central Government, the amount
of tax collected and specified in the statement referred to in the second
proviso to sub-section (5) shall be deemed as payment of tax on behalf of the
person from whom the amount has been collected and credit shall be given to him
for the amount so collected in the assessment made under this Act for the
assessment year for which such income is assessable without the production of
certificate.]
(5) Every person collecting tax in accordance with the provisions of this section shall within [such period as may be prescribed from the time of debit] or receipt of the amount furnish to the buyer [or licensee or lessee] to whose account such amount is debited or from whom such payment is received, a certificate to the effect that tax has been collected, and specifying the sum so collected, the rate at which the tax has been collected and such other particulars as may be prescribed :
[Provided that no certificate may be furnished in a case where tax has been
collected in accordance with the foregoing provisions of this section on or
after the 1st day of April, [2008]
:
Provided further that the prescribed income-tax authority or the person authorised by
such authority referred to in sub-section (3) shall, within the prescribed time
after the end of each financial year [beginning on or after
the 1st day of April, 2008], prepare and deliver to the buyer
referred to in sub-section (1) or, as the case may be, to the licensee or
lessee referred to in sub-section (1C), a statement in the prescribed form specifying
the amount of tax collected and such other particulars as may be prescribed.]
[(5A) Every
person collecting tax [before the 1st day of April, 2005]
in accordance with the provisions of this section shall [prepare within the
prescribed time after the end of each financial year], and deliver or cause to
be delivered to the prescribed income-tax authority [or such other authority or
agency as may be prescribed] such returns in such form and verified in such
manner and setting forth such particulars and within such time as may be
prescribed:]
[Provided that the Board may, if it considers necessary
or expedient so to do, frame a scheme for the purposes of filing such returns with
such other authority or agency referred to in this sub-section.]
[(5B) Without prejudice to the
provisions of sub-section (5A), any person collecting tax, other than in a case
where the seller is a company, the Central Government or a State Government,
may at his option, deliver or cause to be delivered such return to the
prescribed income-tax authority in accordance with such scheme as may be
specified by the Board in this behalf, by notification in the Official Gazette,
and subject to such conditions as may be specified therein, on or before the
prescribed time after the end of each financial year, on a floppy, diskette,
magnetic cartridge tape, CD-ROM or any other computer readable media
(hereinafter referred to as the computer media) and in the manner as may be
specified in that scheme:
Provided that where the person collecting tax is a company or the Central
Government or a State Government, such person shall, in accordance with the
provisions of this section, deliver or cause to be delivered, within the
prescribed time after the end of each financial year, such returns on computer
media under the said scheme.
(5C) Notwithstanding
anything contained in any other law for the time being in force, a return filed
on computer media shall be deemed to be a return for the purposes of
sub-section (5A) and the rules made thereunder and shall be admissible in any
proceedings made thereunder, without further proof of production of the
original, as evidence of any contents of the original or of any facts stated
therein.
(5D) Where
the Assessing Officer considers that the return delivered or caused to be
delivered under sub-section (5B) is defective, he may intimate the defect to
the person collecting tax and give him an opportunity of rectifying the defect
within a period of fifteen days from the date of such intimation or within such
further period which, on an application made in this behalf, the Assessing
Officer may, in his discretion, allow; and if the defect is not rectified
within the said period of fifteen days or, as the case may be, the further
period so allowed, then, notwithstanding anything contained in any other
provision of this Act, such return shall be treated as an invalid return and
the provisions of this Act shall apply as if such person had failed to deliver
the return.]
(6) Any
person responsible for collecting the tax who fails to collect the tax in
accordance with the provisions of this section, shall, notwithstanding such
failure, be liable to pay the tax to the credit of the Central Government in
accordance with the provisions of sub-section (3).
The following sub-section (6A) shall be inserted after
sub-section (6) of section 206C by the Finance Act, 2006, w.e.f. 1-4-2007 :
(6A) If any
person responsible for collecting tax in accordance with the provisions of this
section does not collect the whole or any part of the tax or after collecting,
fails to pay the tax as required by or under this Act, he shall, without
prejudice to any other consequences which he may incur, be deemed to be an
assessee in default in respect of the tax:
Provided that no
penalty shall be charged under section 221 from such person unless the
Assessing Officer is satisfied that the person has without good and sufficient
reasons failed to collect and pay the tax.
(7) Without prejudice to the provisions of sub-section (6), if the [seller] does not collect the tax or after collecting the tax fails to pay it as required under this section, he shall be liable to pay simple interest at the rate of [one] per cent per month or part thereof on the amount of such tax from the date on which such tax was collectible to the date on which the tax was actually paid [and such interest shall be paid before furnishing the quarterly statement for each quarter in accordance with the provisions of sub-section (3)].
(8) Where the tax has not been paid as aforesaid, after it is collected, the amount of the tax together with the amount of simple interest thereon referred to in sub-section (7) shall be a charge upon all the assets of the [seller].]
[(9) Where the Assessing Officer is satisfied
that the total income of the buyer [or licensee or lessee] justifies the collection of the tax at any
lower rate than the relevant rate specified in sub-section (1) [or sub-section
(1C)], the Assessing Officer shall, on an application made by the buyer [or
licensee or lessee] in this behalf, give to him a certificate for collection of
tax at such lower rate than the relevant rate specified in sub-section (1) [or
sub-section (1C)].
(10) Where a
certificate under sub-section (9) is given, the person responsible for
collecting the tax shall, until such certificate is cancelled by the Assessing
Officer, collect the tax at the rates specified in such certificate.
(11) The Board
may, having regard to the convenience of assessees and the interests of
revenue, by notification in the Official Gazette, make rules specifying the
cases in which, and the circumstances under which, an application may be made
for the grant of a certificate under sub-section (9) and the conditions subject
to which such certificate may be granted and providing for all other matters
connected therewith.]
[Explanation.—For the purposes of this section,—
(a) “buyer” means a person who obtains in any sale, by way of
auction, tender or any other mode, goods of the nature specified in the Table
in sub-section (1) or the right to receive any such goods but does not
include,—
[(i) a public sector company, the Central Government, a State Government, and an embassy, a high commission, legation, commission, consulate and the trade representation, of a foreign State and a club; or
(ii) a buyer in the retail sale of such goods purchased
by him for personal consumption;]
[(b) “scrap” means waste and scrap from the manufacture or mechanical working of materials which is definitely not usable as such because of breakage, cutting up, wear and other reasons;
(c) “seller” means the Central Government, a State Government or
any local authority or corporation or authority established by or under a
Central, State or Provincial Act, or any company or firm or co-operative
society and also includes an individual or a Hindu undivided family whose total
sales, gross receipts or turnover from the business or profession carried on by
him exceed the monetary limits specified under clause (a) or clause (b)
of section 44AB during the financial year immediately preceding the financial
year in which the goods of the nature specified in the Table in sub-section (1)
are sold.]]
[Tax collection account number.
206CA. (1) Every person collecting tax in accordance with the provisions of section 206C, shall, within such time as may be prescribed, apply to the Assessing Officer for the allotment of a tax-collection account number.
(2) Where a tax collection account number has
been allotted to a person, such person shall quote such number—
(a) in all challans for the payment of any sum in accordance with
the provisions of sub-section (3) of section 206C;
(b) in all certificates furnished under sub-section (5) of
section 206C;
(c) in all the returns delivered in accordance with the provisions
of sub-section (5A) or sub-section (5B) of section 206C to any income-tax
authority; and
(d) in all other documents pertaining to such transactions as may
be prescribed in the interest of revenue:]
[Provided that the provisions of this section shall not apply
on or after the 1st day of October, 2004.]
C.—Advance payment of tax
[Liability
for payment of advance tax.
207. Tax shall be payable in advance during any financial year, in accordance with the provisions of sections 208 to 219 (both inclusive), in respect of the total income of the assessee which would be chargeable to tax for the assessment year immediately following that financial year, such income being hereafter in this Chapter referred to as “current income”.]
[Conditions of liability to pay
advance tax.
208. Advance
tax shall be payable during a financial year in every case where the amount of
such tax payable by the assessee during that year, as computed in accordance
with the provisions of this Chapter, is [five
thousand] rupees or more.]
209. [(1) The amount of advance tax payable by an assessee in the financial year shall, subject to the provisions of sub-sections (2) and (3), be computed as follows, namely :—
(a) where the calculation is made by the assessee for the
purposes of payment of advance tax under sub-section (1) or sub-section (2) or
sub-section (5) or sub-section (6) of section 210, he shall first estimate his
current income and income-tax thereon shall be calculated at the rates in force
in the financial year;
(b) where the calculation is made by the Assessing Officer for
the purpose of making an order under sub-section (3) of section 210, the total
income of the latest previous year in respect of which the assessee has been
assessed by way of regular assessment or the total income returned by the
assessee in any return of income furnished by him for any subsequent previous
year, whichever is higher, shall be taken and income-tax thereon shall be
calculated at the rates in force in the financial year;
(c) where the calculation is made by the Assessing Officer for
the purpose of making an amended order under sub-section (4) of section 210,
the total income declared in the return furnished by the assessee for the later
previous year, or, as the case may be, the total income in respect of which the
regular assessment, referred to in that sub-section has been made, shall be taken
and income-tax thereon shall be calculated at the rates in force in the
financial year;
(d) the income-tax calculated under clause (a) or clause (b) or clause (c) shall, in each case, be reduced by the amount of income-tax which would be deductible [or collectible] at source during the said financial year under any provision of this Act from any income (as computed before allowing any deductions admissible under this Act) which has been taken into account in computing the current income or, as the case may be, the total income aforesaid; and the amount of income-tax as so reduced shall be the advance tax payable.]
[(2) Where
the Finance Act of the relevant year provides that, in the case of any class of
assessees, net agricultural income (as defined in that Act) shall be taken into
account for the purposes of computing advance tax, then, the net agricul-tural
income to be taken into account in the case of any assessee falling in that
class, shall be—
(a) in cases [where the Assessing Officer makes an order under sub-section (3) or sub-section (4) of section 210],—
(i) if the total income of the latest previous
year in respect of which the assessee has been assessed by way of regular assessment
forms the basis of computation of advance tax payable by him, the net
agricultural income which has been taken into account for the purposes of
charging income-tax for the assessment year relevant to that previous year; or
[(ii) if the total income declared by the assessee for the later previous year referred to in sub-section (4) of section 210 forms the basis of computation of advance tax, the net agricultural income as returned by the assessee in the return of income for the assessment year relevant to such later previous year;]
[(b) in cases where the advance tax is paid by the assessee on the basis of his estimate of his current income under sub-section (1) or sub-section (2) or sub-section (5) or sub-section (6) of section 210, the net agricultural income, as estimated by him, of the period which would be the previous year for the immediately following assessment year.]
(3) Where the Finance Act of the relevant year specifies any separate rate or rates for the purposes of computing advance tax in the case of every Hindu undivided family which has at least one member whose total income of the previous year exceeds the maximum amount not chargeable to income-tax in his case, then, the [Assessing] Officer shall, for making an order under [sub-section (3) or sub-section (4) of] section 210in the case of any such Hindu undivided family, compute (subject to the provisions of section 164) the advance tax at such rate or rates—
(a) in a case where the total income of the latest previous year
in respect of which the Hindu undivided family has been assessed by way of
regular assessment forms the basis of computation of advance tax, if the total
income of any member of the family for the assessment year relevant to such
latest previous year exceeds the maximum amount not chargeable to income-tax in
his case;
(b) in a case where the total income of the previous year [in respect of which a return of income is furnished by the Hindu undivided family under section 139 or in response to a notice under sub-section (1) of section 142] forms the basis of computation of advance tax, if the total income of any member of the family for the assessment year relevant to such previous year exceeds the maximum amount not chargeable to income-tax in his case.
Computation and payment of advance tax
by assessee.
209A. [Omitted by
the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988. Original section was inserted by the Finance
Act, 1978, w.e.f. 1-6-1978.]
[Payment of advance tax by the assessee
of his own accord or in pursuance of order of Assessing Officer.
210. (1)
Every person who is liable to pay advance tax under section 208 (whether or not he has been previously
assessed by way of regular assessment) shall, of his own accord, pay, on or
before each of the due dates specified in section 211, the appropriate percentage, specified in
that section, of the advance tax on his current income, calculated in the
manner laid down in section 209.
(2) A person
who pays any instalment or instalments of advance tax under sub-section (1),
may increase or reduce the amount of advance tax payable in the remaining
instalment or instalments to accord with his estimate of his current income and
the advance tax payable thereon, and make payment of the said amount in the
remaining instalment or instalments accordingly.
(3) In the case of a person who has been already assessed by way of regular assessment in respect of the total income of any previous year [***], the Assessing Officer, if he is of opinion that such person is liable to pay advance tax, may, at any time during the financial year but not later than the last day of February, by order in writing, require such person to pay advance tax calculated in the manner laid down in section 209, and issue to such person a notice of demand under section 156 specifying the instalment or instalments in which such tax is to be paid.
(4) If,
after the making of an order by the Assessing Officer under sub-section (3) and
at any time before the 1st day of March, a return of income is furnished by the
assessee under section 139 or in
response to a notice under sub-section (1) of section 142, or a regular assessment of the assessee is
made in respect of a previous year later than that referred to in sub-section
(3), the Assessing Officer may make an amended order and issue to such assessee
a notice of demand under section 156 requiring the assessee to pay, on or before the due date or each of the
due dates specified in section 211
falling after the date of the amended order, the appropriate percentage,
specified in section 211, of the
advance tax computed on the basis of the total income declared in such return
or in respect of which the regular assessment aforesaid has been made.
(5) A person who is served with an order of the Assessing Officer under sub-section (3) or an amended order under sub-section (4) may, if in his estimation the advance tax payable on his current income would be less than the amount of the advance tax specified in such order or amended order, send an intimation in the prescribed form to the Assessing Officer to that effect and pay such advance tax as accords with his estimate, calculated in the manner laid down in section 209, at the appropriate percentage thereof specified in section 211, on or before the due date or each of the due dates specified in section 211 falling after the date of such intimation.
(6) A person
who is served with an order of the Assessing Officer under sub-section (3) or
amended order under sub-section (4) shall, if in his estimation the advance tax
payable on his current income would exceed the amount of advance tax specified
in such order or amended order or intimated by him under sub-section (5), pay
on or before the due date of the last instalment specified in section
211, the appropriate part or, as the
[Instalments of advance tax and due dates.
211. [(1) Advance tax on the current income calculated in the manner laid down in section 209 shall be payable by—
(a) all the companies, who are liable to pay the same, in four
instalments during each financial year and the due date of each instalment and
the amount of such instalment shall be as specified in Table I below :
Table I
|
Due date of installment |
Amount payable |
|
On or before the 15th June |
Not less than fifteen per cent of such advance tax. |
|
On or before the 15th September |
Not less than forty-five per cent of such advance tax, as reduced by the amount, if any, paid in the earlier instalment. |
|
On or before the 15th December |
Not less than seventy-five per cent of such advance tax, as reduced by the amount or amounts, if any, paid in the earlier instalment or instalments. |
|
On or before the 15th March |
The whole amount of such advance tax as reduced by the amount or amounts, if any, paid in the earlier instalment or instalments; |
(b) all the assessees (other than companies), who are liable to
pay the same, in three instalments during each financial year and the due date of
each instalment and the amount of such instalment shall be as specified in
Table II below :
Table II
|
Due date of installment |
Amount payable |
|
On or before the 15th September |
Not less than thirty per cent of such advance tax. |
|
On or before the 15th December |
Not less than sixty per cent of such advance tax, as reduced by the amount , if any, paid in the earlier instalment or instalments. |
|
On or before the 15th March |
The whole amount of such advance tax as reduced by the amount or amounts, if any, paid in the earlier instalment or instalments. |
Provided that
any amount paid by way of advance tax on or before the 31st day of March shall
also be treated as advance tax paid during the financial year ending on that day
for all the purposes of this Act.]
(2) If the
notice of demand issued under section 156 in pursuance of an order of the Assessing Officer under sub-section (3)
or sub-section (4) of section 210
is served after any of the due dates specified in sub-section (1), the
appropriate part or, as the case may be, the whole of the amount of the advance
tax specified in such notice shall be payable on or before each of such of
those dates as fall after the date of service of the notice of demand.]
212. [Omitted
by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.]
213. [Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.]
Interest payable by
Government.
214. (1)
The Central Government shall pay simple interest at [fifteen] per cent per
annum on the amount by which the aggregate sum of any instalments of advance
tax paid during any financial year in which they are payable under sections 207
to 213 exceeds the amount of the [assessed tax] from the 1st day of April next
following the said financial year to the date of the regular assessment for the
assessment year immediately following the said financial year, and where any
such instalment is paid after the expiry of the financial year, during which it
is payable by reason of the provisions of section 213, interest as aforesaid shall also be payable
on that instalment from the date of its payment to the date of regular
assessment :
[Provided
that in respect of any amount
refunded on a provisional assessment under section 141A, no interest shall be paid for any period
after the date of such provisional assessment.]
[(1A) Where as a result of an order under section 147 or section 154 or section 155 or section 250or section 254 or section 260 or section 262 or section 263 or section 264 [or an order of the Settlement Commission under sub-section (4) of section 245D], the amount on which interest was payable under sub-section (1) has been increased or reduced, as the case may be, the interest shall be increased or reduced accordingly, and in a case where the interest is reduced, the [Assessing] Officer shall serve on the assessee, a notice of demand in the prescribed form specifying the amount of the excess interest payable and requiring him to pay such amount ; and such notice of demand shall be deemed to be a notice under section 156 and the provisions of this Act shall apply accordingly.]
(2) On any portion
of such amount which is refunded under this Chapter, interest shall be payable
only up to the date on which the refund was made.
[(3) This
section and sections 215, 216 and 217 shall not apply in respect of any assessment for the assessment year commencing
on the 1st day of April, 1989, or any subsequent assessment year and, in the
application of the said sections to the assessment for any earlier assessment
year, references therein [except in sub-section (1A) and sub-section (3) of section
215] to the other provisions of this Act
shall be construed as references to those provisions as for the time being in
force and applicable to the relevant assessment year.]
[Explanation
1.—In this section, “assessed tax” shall have the
same meaning as in sub-section (5) of section 215.
Explanation
2.—Where, in relation to an
assessment year, an assessment is made for the first time under section
147, the assessment so made shall be
regarded as a regular assessment for the purposes of this section.]
215. [(1) Where, in any financial year, an assessee
has paid [advance tax under section 209A or section 212 on the
basis of his own estimate (including revised estimate)], and the advance tax so
paid is less than seventy-five per cent of the assessed tax, simple interest at
the rate of [fifteen] per cent per annum from the 1st day of April next
following the said financial year up to the date of the regular assessment
shall be payable by the assessee upon the amount by which the advance tax so
paid falls short of the assessed tax :]
[Provided that in the case of an assessee, being a
company, the provisions of this sub-section shall have effect as if for the
words “seventy-five per cent”, the words “eighty-three and one-third per cent”
had been substituted.]
[(2) Where
before the date of completion of a regular assessment, tax is paid by the
assessee under section 140A or
otherwise,—
(i) interest shall be calculated in accordance with the foregoing
provision up to the date on which the tax is so paid ; and
(ii) thereafter, interest shall be calculated at the rate
aforesaid on the amount by which the tax as so paid (in so far as it relates to
income subject to advance tax) falls short of the assessed tax.]
[(3) Where
as a result of an order under section 147 or section 154 or section
155 or section 250 or section 254 or section 260 or section
262 or section 263 or section 264 [or an order of the Settlement Commission under sub-section (4) of
section 245D], the amount on which interest was payable under sub-section (1)
has been increased or reduced, as the case may be, the interest shall be
increased or reduced accordingly, and—
(i) in a case where the interest is increased, the [Assessing] Officer
shall serve on the assessee, a notice of demand in the prescribed form
specifying the sum payable, and such notice of demand shall be deemed to be a
notice under section 156 and the provisions of this Act shall apply accordingly
;
(ii) in a case where the interest is
reduced, the excess interest paid, if any, shall be refunded.]
(4) In such cases and under such circumstances
as may be prescribed, the [Assessing] Officer may reduce or waive the interest
payable by the assessee under this section.
[(5) In this
section and sections 217 and 273, “assessed tax” means the tax determined on
the basis of the regular assessment (reduced by the amount of tax deductible in
accordance with the provisions of sections 192 to 194, section 194A [, section 194C] [, section 194D] [, section
195 and section 196A] so far as such tax relates to income subject
to advance tax and so far as it is not due to variations in the rates of tax
made by the Finance Act enacted for the year for which the regular assessment
is made.]
[(6) Where,
in relation to an assessment year, an assessment is made for the first time
under section 147, the assessment
so made shall be regarded as a regular assessment for the purposes of this
section and sections 216, 217 and 273.]
Interest payable by
assessee in case of under-estimate, etc.
216. Where,
on making the regular assessment, the [Assessing] Officer finds that any
assessee has—
[(a) under [section 209A or section 212] under-estimated the advance
tax payable by him and thereby reduced the amount payable in either of the
first two instalments ; or]
(b) under section 213 wrongly deferred the payment of advance tax
on a part of his income ;
he may direct that
the assessee shall pay simple interest at [fifteen] per cent per annum—
(i) in the case referred to in clause (a), for the period during
which the payment was deficient, on the difference between the amount paid in
each such instalment and the amount which should have been paid, having regard
to the aggregate advance tax actually paid during the year ; and
(ii) in the case
referred to in clause (b), for the period during which the payment of
advance tax was so deferred.
Explanation.—For the purposes of this section, any
instalment due before the expiry of six months from the commencement of the
previous year in respect of which it is to be paid shall be deemed to have
become due fifteen days after the expiry of the said six months.
Interest
payable by assessee when no estimate made.
217. [(1)
Where, on making the regular assessment, [the [Assessing] Officer finds—
(a) that any such person as is referred to in clause (a)
of sub-section (1) of section 209A has not sent the statement referred to in that
clause or the estimate in lieu of such statement referred to in sub-section (2)
of that section ; or
(b) that any such person as is referred to
in clause (b) of sub-section (1) of section 209A has not sent the
estimate referred to in that clause,]
simple
interest at the rate of [fifteen] per cent per annum from the 1st day of April
next following the financial year in which the advance tax was payable in
accordance with the said [sub-section (1) or sub-section (2)] up to the date of
the regular assessment shall be payable by the assessee upon the amount equal
to the assessed tax as defined in sub-section (5) of section 215.]
[(1A) Where,
on making the regular assessment, the [Assessing] Officer finds that [any
person who is required to send an estimate under sub-section (4) of section
209A or] any such person as is referred
to in sub-section (3A) of section 212 has not sent the estimate referred to therein, simple interest at the
rate of [fifteen] per cent per annum from the 1st day of April next following
the financial year in which the advance tax was payable in accordance with the
said [sub-section (4) or, as the case may be, sub-section (3A)] up to the date
of the regular assessment shall be payable by the assessee upon the amount by
which the advance tax paid by him falls short of the assessed tax as defined in
sub-section (5) of section 215.]
(2) The provisions of sub-sections (2), (3)
and (4) of section 215 shall
apply to interest payable under this section as they apply to interest payable
under that section.
When
assessee deemed to be in default.
218. [If any assessee
does not pay on the date specified in sub-section (1) of section 211, any instalment of the advance tax that he is
required to pay by an order of the Assessing Officer under sub-section (3) or
sub-section (4) of section 210and
does not, on or before the date on which any such instalment as is not paid
becomes due, send to the Assessing Officer an intimation under sub-section (5)
of section 210 or does not pay on
the basis of his estimate of his current income the advance tax payable by him
under sub-section (6) of section 210, he shall be deemed to be an assessee in default in respect of such
instalment or instalments.]
219. Any
sum, other than a penalty or interest, paid by or recovered from an assessee as
advance tax in pursuance of this Chapter shall be treated as a payment of tax
in respect of the income of the period which would be the previous year for an
assessment for the assessment year next following the financial year in which
it was payable, and credit therefor shall be given to the assessee in the
regular assessment.
[***]
D.—Collection and recovery
When
tax payable and when assessee deemed in default.
220. (1)
Any amount, otherwise than by way of advance tax, specified as payable in a
notice of demand under section 156
shall be paid within [thirty] days of the service of the notice at the place
and to the person mentioned in the notice :
Provided that,
where the [Assessing] Officer has any reason to believe that it will be detrimental
to revenue if the full period of [thirty] days aforesaid is allowed, he may,
with the previous approval of the [Joint Commissioner], direct that the sum
specified in the notice of demand shall be paid within such period being a
period less than the period of [thirty] days aforesaid, as may be specified by
him in the notice of demand.
(2) If the
amount specified in any notice of demand under section 156 is not paid within the period limited under
sub-section (1), the assessee shall be liable to pay simple interest at [[one] per cent for every
month or part of a month comprised in the period commencing from the day
immediately following the end of the period mentioned in sub-section (1) and
ending with the day on which the amount is paid:]
[Provided that, where as a result of an order under section
154, or section 155, or section 250, or section 254 or section
260, or section 262, or section 264 [or an order of the Settlement Commission under sub-section (4) of section
245D], the amount on which interest was
payable under this section had been reduced, the interest shall be reduced
accordingly and the excess interest paid, if any, shall be refunded
:]
[Provided further that in respect of any period commencing on or before the 31st day of
March, 1989 and ending after that date, such interest shall, in respect of so
much of such period as falls after that date, be calculated at the rate of one
and one-half per cent, for every month or part of a month.]
[(2A) Notwithstanding anything contained in sub-section (2), [the Chief
Commissioner or Commissioner] may] reduce or waive the amount of interest [paid
or] payable by an assessee under the said sub-section if [he is satisfied]
that—
(i) payment of such amount
[has caused or] would cause genuine hardship to the assessee ;
(ii) default in the
payment of the amount on which interest [has been paid or] was payable under
the said sub-section was due to circumstances beyond the control of the
assessee ; and
(iii) the assessee has
co-operated in any inquiry relating to the assessment or any proceeding for the
recovery of any amount due from him.]
(3) Without prejudice to the provisions
contained in sub-section (2), on an application made by the assessee before the
expiry of the due date under sub-section (1), the [Assessing] Officer may
extend the time for payment or allow payment by instalments, subject to such
conditions as he may think fit to impose in the circumstances of the case.
(4) If the amount is not paid within the time
limited under sub-section (1) or extended under sub-section (3), as the case
may be, at the place and to the person mentioned in the said notice the assessee
shall be deemed to be in default.
(5) If, in a case where payment by instalments
is allowed under sub-section (3), the assessee commits defaults in paying any
one of the instalments within the time fixed under that sub-section, the
assessee shall be deemed to be in default as to the whole of the amount then
outstanding, and the other instalment or instalments shall be deemed to have
been due on the same date as the instalment actually in default.
(6) Where an assessee has presented an appeal
under section 246 [or section
246A] the [Assessing] Officer may, in
his discretion and subject to such conditions as he may think fit to impose in
the circumstances of the case, treat the assessee as not being in default in
respect of the amount in dispute in the appeal, even though the time for
payment has expired, as long as such appeal remains undisposed of.
(7) Where an assessee has been assessed in
respect of income arising outside India in a country the laws of which prohibit
or restrict the remittance of money to India, the [Assessing] Officer shall not
treat the assessee as in default in respect of that part of the tax which is
due in respect of that amount of his income which, by reason of such
prohibition or restriction, cannot be brought into India, and shall continue to
treat the assessee as not in default in respect of such part of the tax until
the prohibition or restriction is removed.
Explanation.—For the purposes of this section, income
shall be deemed to have been brought into India if it has been utilised or
could have been utilised for the purposes of any expenditure actually incurred
by the assessee outside India or if the income, whether capitalised or not, has
been brought into India in any form.
Penalty
payable when tax in default.
221. [(1) When an assessee is in default or is
deemed to be in default in making a payment of tax, he shall, in addition to
the amount of the arrears and the amount of interest payable under sub-section
(2) of section 220, be liable, by
way of penalty, to pay such amount as the [Assessing] Officer may direct, and
in the case of a continuing default, such further amount or amounts as the [Assessing]
Officer may, from time to time, direct, so, however, that the total amount of
penalty does not exceed the amount of tax in arrears :
Provided that
before levying any such penalty, the assessee shall be given a reasonable
opportunity of being heard :
[Provided further that where the assessee proves to the satisfaction of the [Assessing]
Officer that the default was for good and sufficient reasons, no penalty shall
be levied under this section.]
[Explanation.—For the removal of doubt, it is hereby declared that an
assessee shall not cease to be liable to any penalty under this sub-section
merely by reason of the fact that before the levy of such penalty he has paid
the tax.]
(2) Where as a result of any final order the
amount of tax, with respect to the default in the payment of which the penalty
was levied, has been wholly reduced, the penalty levied shall be cancelled and
the amount of penalty paid shall be refunded.
Certificate
to Tax Recovery Officer.
222. [(1) When an assessee is in default or is
deemed to be in default in making a payment of tax, the Tax Recovery Officer
may draw up under his signature a statement in the prescribed form specifying
the amount of arrears due from the assessee (such statement being hereafter in
this Chapter and in the Second Schedule referred to as “certificate”) and shall
proceed to recover from such assessee the amount specified in the certificate
by one or more of the modes mentioned below, in accordance with the rules laid
down in the Second Schedule—]
(a) attachment and sale of the assessee’s movable property ;
(b) attachment and sale of the assessee’s immovable property ;
(c) arrest of the assessee and his detention in prison ;
(d) appointing a receiver for the management of the assessee’s
movable and immovable properties.
[Explanation.—For the purposes of this
sub-section, the assessee’s movable or immovable property shall include any
property which has been transferred, directly or indirectly on or after the 1st
day of June, 1973, by the assessee to his spouse or minor child or son’s wife
or son’s minor child, otherwise than for adequate consideration, and which is
held by, or stands in the name of, any of the persons aforesaid; and so far as
the movable or immovable property so transferred to his minor child or his
son’s minor child is concerned, it shall, even after the date of attainment of
majority by such minor child or son’s minor child, as the case may be, continue
to be included in the assessee’s movable or immovable property for recovering
any arrears due from the assessee in respect of any period prior to such date.]
[(2) The Tax
Recovery Officer may take action under sub-section (1), notwithstanding that proceedings for recovery of the arrears by any other
mode have been taken.]
[Tax Recovery Officer by whom recovery is to be effected.
223. (1)
The Tax Recovery Officer competent to take action under section 222 shall be—
(a) the Tax Recovery Officer within whose jurisdiction the
assessee carries on his business or profession or within whose jurisdiction the
principal place of his business or profession is situate, or
(b) the Tax Recovery Officer within
whose jurisdiction the assessee resides or any movable or immovable property of
the assessee is situate,
the
jurisdiction for this purpose being the jurisdiction assigned to the Tax
Recovery Officer under the orders or directions issued by the Board, or by the
Chief Commissioner or Commissioner who is authorised in this behalf by the
Board in pursuance of section 120.
(2) Where an assessee has property within the
jurisdiction of more than one Tax Recovery Officer and the Tax Recovery Officer
by whom the certificate is drawn up—
(a) is not able to recover the entire amount
by sale of the property, movable or immovable, within his jurisdiction, or
(b) is of the opinion that, for the purpose
of expediting or securing the recovery of the whole or any part of the amount
under this Chapter, it is necessary so to do,
he may send
the certificate or, where only a part of the amount is to be recovered, a copy
of the certificate certified in the prescribed manner and specifying the amount
to be recovered to a Tax Recovery Officer within whose jurisdiction the
assessee resides or has property and, thereupon, that Tax Recovery Officer
shall also proceed to recover the amount under this Chapter as if the
certificate or copy thereof had been drawn up by him.]
[Validity of certificate and
cancellation or amendment thereof.
224. It shall not be open to the assessee to
dispute the correctness of any
certificate drawn up by the Tax Recovery Officer on any ground
whatsoever, but it shall be lawful for the Tax Recovery Officer to cancel the
certificate if, for any reason, he thinks it necessary so to do, or to correct
any clerical or arithmetical mistake therein.]
[Stay of
proceedings in pursuance of certificate and amendment or cancellation thereof.
225. (1) It shall be lawful for the Tax Recovery
Officer to grant time for the payment of
any tax and when he does so, he shall stay the proceedings for the recovery of
such tax until the expiry of the time so granted.
(2) Where the order giving rise to a demand of
tax for which a certificate has been drawn up is modified in appeal or other
proceeding under this Act, and, as a consequence thereof, the demand is reduced
but the order is the subject-matter of further proceeding under this Act, the
Tax Recovery Officer shall stay the recovery of such part of the amount
specified in the certificate as pertains to the said reduction for the period
for which the appeal or other proceeding remains pending.
(3) Where a certificate has been drawn up and
subsequently the amount of the outstanding demand is reduced as a result of an
appeal or other proceeding under this Act, the Tax Recovery Officer shall, when
the order which was the subject-matter of such appeal or other proceeding has
become final and conclusive, amend the certificate, or cancel it, as the case
may be.]
226. [(1) Where no certificate has been drawn up
under section 222, the Assessing
Officer may recover the tax by any one or more of the modes provided in this
section.
(1A) Where a
certificate has been drawn up under section 222, the Tax Recovery Officer may, without prejudice to the modes of
recovery specified in that section, recover the tax by any one or more of the
modes provided in this section.]
(2) If any assessee is in receipt of any
income chargeable under the head “Salaries”, the [Assessing] Officer [or Tax
Recovery Officer] may require any person paying the same to deduct from any
payment subsequent to the date of such requisition any arrears of tax due from
such assessee, and such person shall comply with any such requisition and shall
pay the sum so deducted to the credit of the Central Government or as the Board
directs :
Provided that any part of
the salary exempt from attachment in execution of a decree of a civil court
under section 60 of the Code of Civil Procedure, 1908 (5 of 1908), shall be
exempt from any requisition made under this sub-section.
(3) (i) The [Assessing] Officer [or Tax
Recovery Officer] may, at any time or from time to time, by notice in writing
require any person from whom money is due or may become due to the assessee or
any person who holds or may subsequently hold money for or on account of the
assessee to pay to the [Assessing] Officer [or Tax Recovery Officer] either
forthwith upon the money becoming due or being held or at or within the time
specified in the notice (not being before the money becomes due or is held) so
much of the money as is sufficient to pay the amount due by the assessee in
respect of arrears or the whole of the money when it is equal to or less than
that amount.
(ii) A notice under this sub-section
may be issued to any person who holds or may subsequently hold any money for or
on account of the assessee jointly with any other person and for the purposes
of this sub-section, the shares of the joint holders in such account shall be
presumed, until the contrary is proved, to be equal.
(iii) A copy of the notice shall be
forwarded to the assessee at his last address known to the [Assessing] Officer [or
Tax Recovery Officer], and in the case of a joint account to all the joint
holders at their last addresses known to the [Assessing] Officer [or Tax
Recovery Officer].
(iv) Save as otherwise provided in this
sub-section, every person to whom a notice is issued under this sub-section
shall be bound to comply with such notice, and, in particular, where any such
notice is issued to a post office, banking company or an insurer, it shall not
be necessary for any pass book, deposit receipt, policy or any other document
to be produced for the purpose of any entry, endorsement or the like being made
before payment is made, notwithstanding any rule, practice or requirement to
the contrary.
(v) Any claim respecting any property
in relation to which a notice under this sub-section has been issued arising
after the date of the notice shall be void as against any demand contained in
the notice.
(vi) Where a person to whom a notice
under this sub-section is sent objects to it by a statement on oath that the
sum demanded or any part thereof is not due to the assessee or that he does not
hold any money for or on account of the assessee, then nothing contained in
this sub-section shall be deemed to require such person to pay any such sum or
part thereof, as the case may be, but if it is discovered that such statement
was false in any material particular, such person shall be personally liable to
the [Assessing] Officer [or Tax Recovery Officer] to the extent of his own
liability to the assessee on the date of the notice, or to the extent of the
assessee’s liability for any sum due under this Act, whichever is less.
(vii) The [Assessing] Officer [or Tax
Recovery Officer] may, at any time or from time to time, amend or revoke any
notice issued under this sub-section or extend the time for making any payment
in pursuance of such notice.
(viii) The [Assessing] Officer [or Tax
Recovery Officer] shall grant a receipt for any amount paid in compliance with
a notice issued under this sub-section, and the person so paying shall be fully
discharged from his liability to the assessee to the extent of the amount so
paid.
(ix) Any person discharging any
liability to the assessee after receipt of a notice under this sub-section
shall be personally liable to the [Assessing] Officer [or Tax Recovery Officer]
to the extent of his own liability to the assessee so discharged or to the
extent of the assessee’s liability for any sum due under this Act, whichever is
less.
(x) If the person to whom a notice
under this sub-section is sent fails to make payment in pursuance thereof to
the [Assessing] Officer [or Tax Recovery Officer], he shall be deemed to be an
assessee in default in respect of the amount specified in the notice and
further proceedings may be taken against him for the realisation of the amount
as if it were an arrear of tax due from him, in the manner provided in sections
222 to 225 and the notice shall have the same effect as an attachment of a debt
by the Tax Recovery Officer in exercise of his powers under section 222.
(4) The [Assessing] Officer [or Tax Recovery
Officer] may apply to the court in whose custody there is money belonging to
the assessee for payment to him of the entire amount of such money, or, if it
is more than the tax due, an amount sufficient to discharge the tax.
[(5) The [Assessing]
Officer [or Tax Recovery Officer] may, if so authorised by the [Chief Commissioner
or Commissioner] by general or special order, recover any arrears of tax due
from an assessee by distraint and sale of his movable property in the manner
laid down in the Third Schedule.]
Recovery through State Government.
227. If the recovery of tax in any area has been
entrusted to a State Government under clause (1) of article 258 of the
Constitution, the State Government may direct, with respect to that area or any
part thereof; that tax shall be recovered therein with, and as an addition to,
any municipal tax or local rate, by the same person and in the same manner as
the municipal tax or local rate is recovered.
Recovery of Indian tax in Pakistan and Pakistan tax in India.
228. [Omitted by the Direct Tax Laws
(Amendment) Act, 1987, w.e.f. 1-4-1989.]
[Recovery
of tax in pursuance of agreements with foreign countries.
228A. (1) Where an agreement is entered into by the
Central Government with the Government of any country outside India for
recovery of income-tax under this Act and the corresponding law in force in
that country and the Government of that country or any authority under that
Government which is specified in this behalf in such agreement sends to the
Board a certificate for the recovery of any tax due under such corresponding law
from a person having any property in India, the Board may forward such
certificate to any Tax Recovery Officer within whose jurisdiction such property
is situated and thereupon such Tax Recovery Officer shall—
(a) proceed to recover the amount
specified in the certificate in the manner in which he would proceed to recover
the amount [specified in a certificate drawn up by him under section 222]; and
(b) remit any sum so recovered by him to the Board after
deducting his expenses in connection with the recovery proceedings.
[(2) Where
an assessee is in default or is deemed to be in default in making a payment of
tax, the Tax Recovery Officer may, if the assessee has property in a country
outside India (being a country with which the Central Government has entered
into an agreement for the recovery of income-tax under this Act and the
corresponding law in force in that country), forward to the Board a certificate
drawn up by him under section 222
and the Board may take such action thereon as it may deem appropriate having
regard to the terms of the agreement with such country.]
Recovery of
penalties, fine, interest and other sums.
229. Any sum imposed by way of interest, fine,
penalty, or any other sum payable under the provisions of this Act, shall be recoverable
in the manner provided in this Chapter for the recovery of arrears of tax.
230. [(1) Subject to such exceptions as the Central Government may, by notification in the Official
Gazette, specify in this behalf, no person,—
(a) who is not domiciled in India;
(b) who has come to India in connection with business, profession
or employment; and
(c) who has income derived from any source in India,
shall leave the territory of India by land, sea or
air unless he furnishes to such authority as may be prescribed—
(i) an undertaking in the prescribed form from
his employer; or
(ii) through whom such person is in receipt of the income,
to the effect that tax payable by such person
who is not domiciled in India shall be paid by the employer referred to in
clause (i) or the person referred to in clause (ii), and the
prescribed authority shall, on receipt of the undertaking, immediately give to
such person a no objection certificate, for leaving India:
Provided that nothing contained in sub-section (1) shall apply to a person who is
not domiciled in India but visits India as a foreign tourist or for any other
purpose not connected with business, profession or employment.
(1A)
Subject to such exceptions as the Central Government may, by notification in
the Official Gazette, specify in this behalf, every person, who is domiciled in
India at the time of his departure from India, shall furnish, in the prescribed
form to the income-tax authority or such other authority as may be prescribed—
(a) the permanent account number allotted to him under section
139A:
Provided that in case no such permanent account number has been allotted to him,
or his total income is not chargeable to income-tax or he is not required to
obtain a permanent account number under this Act, such person shall furnish a
certificate in the prescribed form;
(b) the purpose of his visit outside India;
(c) the estimated period of his stay outside India:
Provided that no person—
(i) who is domiciled in India at the time of his departure; and
(ii) in respect of whom circumstances
exist which, in the opinion of an income-tax authority render it necessary for
such person to obtain a certificate under this section,
shall leave the territory of India
by land, sea or air unless he obtains a certificate from the income-tax
authority stating that he has no liabilities under this Act, or the Wealth-tax
Act, 1957 (27 of 1957), or the Gift-tax Act, 1958 (18 of 1958), or the Expenditure-tax
Act, 1987 (35 of 1987), or that satisfactory arrangements have been made for
the payment of all or any of such taxes which are or may become payable by that
person :
Provided that no income-tax authority shall make it
necessary for any person who is domiciled in India to obtain a certificate
under this section unless he records the reasons therefor and obtains the prior
approval of the Chief Commissioner of Income-tax.]
(2) If the owner or charterer of any ship or
aircraft carrying persons from any place in the territory of India to any place
outside India allows any person to whom sub-section (1) [or the first proviso
to sub-section (1A)] applies to travel by such ship or aircraft without first
satisfying himself that such person is in possession of a certificate as
required by that sub-section, he shall be personally liable to pay the whole or
any part of the amount of tax, if any, payable by such person as the [Assessing]
Officer may, having regard to the circumstances of the case, determine.
(3) In respect of any sum payable by the owner
or charterer of any ship or aircraft under sub-section (2), the owner or
charterer, as the case may be, shall be deemed to be an assessee in default for
such sum, and such sum shall be recoverable from him in the manner provided in
this Chapter as if it were an arrear of tax.
(4) The Board may make rules for regulating
any matter necessary for, or incidental to, the purpose of carrying out the
provisions of this section.
Explanation.—For the purposes of
this section, the expressions “owner” and “charterer” include any
representative, agent or employee empowered by the owner or charterer to allow
persons to travel by the ship or aircraft.
Restrictions
on registration of transfers of immovable property in certain cases.
230A. [Omitted by
the Finance Act, 2001, w.e.f. 1-6-2001.]
Period for
commencing recovery proceedings.
231. [Omitted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989.]
Recovery by
suit or under other law not affected.
232. The several modes of recovery specified in
this Chapter shall not affect in any way—
(a) any other law for the time being in force relating to the
recovery of debts due to Government; or
(b) the right of the Government to institute a suit for the
recovery of the arrears due from the assessee;
and it shall
be lawful for the [Assessing] Officer or the Government, as the case may be, to
have recourse to any such law or suit, notwithstanding that the tax due is
being recovered from the assessee by any mode specified in this Chapter.
E.—Tax payable under provisional assessment
Recovery of
tax payable under provisional assessment.
233. [Omitted by the Taxation Laws (Amendment)
Act, 1970, w.e.f. 1-4-1971.]
Tax paid by
deduction or advance payment.
234. [Omitted by the Direct Tax Laws
(Amendment) Act, 1987, w.e.f. 1-4-1989.]
[F.—Interest chargeable in certain cases
Interest for defaults in furnishing
return of income.
234A. (1) Where the return of income for any
assessment year under sub- section (1) or sub-section (4) of section 139, or in response to a notice under sub-section
(1) of section 142, is furnished
after the due date, or is not furnished, the assessee shall be liable to pay
simple interest at the rate of [one] per cent for every month or part of a
month comprised in the period commencing on the date immediately following the
due date, and,—
(a) where the return is furnished after the due date, ending on
the date of furnishing of the return; or
(b) where no return has been furnished, ending on the date of
completion of the assessment under section 144,
[on the amount of [the tax on the total income as determined
under sub-section (1) of section 143 or on regular assessment as reduced by the
advance tax, if any, paid and any tax deducted or collected at source]].
Explanation
1.—In this section, “due
date” means the date specified in sub-section (1) of section 139 as applicable in the case of the assessee.
[Explanation
2.—In this sub-section, “tax on the total income as determined under
sub-section (1) of section 143”
shall not include the additional income-tax, if any, payable under section
143.]
Explanation
3.—Where, in relation to an
assessment year, an assessment is made for the first time under section
147 [or section 153A], the assessment so made shall be regarded as
a regular assessment for the purposes of this section.
Explanation
4.—[* * *]
(2) The interest payable under sub-section (1)
shall be reduced by the interest, if any, paid under section 140A towards the interest chargeable under this
section.
(3) Where the return of income for any
assessment year, required by a notice under section 148 [or section 153A] issued [after the determination of income
under sub-section (1) of section 143 or] after the completion of an assessment under sub-section (3) of section
143 or section 144 or section 147, is furnished after the expiry
of the time allowed under such notice, or is not furnished, the assessee shall
be liable to pay simple interest at the rate of [one] per cent for every month
or part of a month comprised in the period commencing on the day immediately
following the expiry of the time allowed as aforesaid, and,—
(a) where
the return is furnished after the expiry of the time aforesaid, ending on the
date of furnishing the return; or
(b) where no return has been furnished, ending on the date of
completion of the re-assessment or re-computation under Section 147 [or reassessment under section 153A],
on the amount by
which the tax on the total income determined on the basis of such re-assessment
or re-computation exceeds the tax on the total income determined [under
sub-section (1) of section 143
or] on the basis of the earlier assessment aforesaid.
Explanation.—[* * *]
(4) Where as a result of an order under section
154 or section 155 or section 250 or section 254 or section
260or section 262 or section 263 or section 264 or an
order of the Settlement Commission under sub-section (4) of section 245D, the amount of tax on which interest was
payable under sub-section (1) or sub-section (3) of this section has been
increased or reduced, as the case may be, the interest shall be increased or
reduced accordingly, and—
(i) in
a case where the interest is increased, the Assessing Officer shall serve on
the assessee a notice of demand in the prescribed form specifying the sum
payable, and such notice of demand shall be deemed to be a notice under section
156 and the provisions of this Act shall
apply accordingly;
(ii) in a case where the interest is reduced, the excess interest
paid, if any, shall be refunded.
(5) The provisions of this section shall apply
in respect of assessments for the assessment year commencing on the 1st day of
April, 1989 and subsequent assessment years.]
[Interest
for defaults in payment of advance tax.
234B. (1) Subject to the other provisions of this
section, where, in any financial year, an assessee who is liable to pay advance
tax under section 208 has failed to pay such tax or, where the advance tax paid
by such assessee under the provisions of section 210 is less than ninety per
cent of the assessed tax, the assessee shall be liable to pay simple interest
at the rate of [one] per cent for every month or part of a month comprised in
the period from the 1st day of April next following such financial year [to the
date of determination of total income under sub-section (1) of section 143 [and
where a regular assessment is made, to the date of such regular assessment, on
an amount]] equal to the assessed tax or, as the case may be, on the amount by
which the advance tax paid as aforesaid falls short of the assessed tax.
[Explanation
1.—In this section, “assessed tax” means the tax on the total income
determined under sub-section (1) of section 143 or on regular assessment as
reduced by the amount of tax deducted or collected at source in accordance with
the provisions of Chapter XVII on any income which is subject to such deduction
or collection and which is taken into account in computing such total income.]
The following Explanation 1 shall
be substituted for the existing Explanation 1 to sub-section (1) of
section 234B by the Finance Act, 2006, w.e.f. 1-4-2007 :
Explanation 1.—In this section,
“assessed tax” means the tax on the total income determined under sub-section
(1) of section 143 and where a regular assessment is made, the tax on the total
income determined under such regular assessment as reduced by the amount of,—
(i) any tax deducted or collected
at source in accordance with the provisions of Chapter XVII on any income which
is subject to such deduction or collection and which is taken into account in
computing such total income;
(ii) any relief of tax
allowed under section 90 on account of tax paid in a country outside India;
(iii) any
relief of tax allowed under section 90A on account of tax paid in a specified
territory outside India referred to in that section;
(iv) any deduction, from
the Indian income-tax payable, allowed under section 91, on account of tax paid
in a country outside India; and
(v) any
tax credit allowed to be set off in accordance with the provisions of section
115JAA.
Explanation
2.—Where, in relation to an
assessment year, an assessment is made for the first time under section 147 [or
section 153A], the assessment so made shall be regarded as a regular assessment
for the purposes of this section.
[Explanation
3.—In Explanation 1 and in sub-section (3) “tax on the total income
determined under sub-section (1) of section 143” shall not include the
additional income-tax, if any, payable under section 143.]
(2) Where, before the date of [determination
of total income under sub-section (1) of section 143 or] completion of a
regular assessment, tax is paid by the assessee under section 140a or
otherwise,—
(i) interest
shall be calculated in accordance with the foregoing provisions of this section
up to the date on which the tax is so paid, and reduced by the interest, if
any, paid under section 140A towards the interest chargeable under this
section;
(ii) thereafter,
interest shall be calculated at the rate aforesaid on the amount by which the
tax so paid together with the advance tax paid falls short of the assessed tax.
(3) Where, as a result of an order of
re-assessment or re-computation under section 147 [or section 153A], the amount
on which interest was payable under sub-section (1) is increased, the assessee
shall be liable to pay simple interest at the rate of [one] per cent for every
month or part of a month comprised in the period commencing on the day
following [the date of determination of total income under sub-section (1) of
section 143 [and where a regular assessment is made as is referred to in
sub-section (1) following the date of such regular assessment]] and ending on
the date of the re-assessment or re-computation under section 147 [or section
153A], on the amount by which the tax on the total income determined on the
basis of the re-assessment or re-computation exceeds the tax on the total
income determined [under sub-section (1) of section 143 or] on the basis of the
regular assessment aforesaid.
Explanation.—[* * *]
(4) Where, as a result of an order under
section 154 or section 155 or section 250 or section 254 or section 260 or
section 262 or section 263 or section 264 or an order of the Settlement
Commission under sub-section (4) of section 245D, the amount on which interest
was payable under sub-section (1) or sub-section (3) has been increased or
reduced, as the case may be, the interest shall be increased or reduced
accordingly, and—
(i) in
a case where the interest is increased, the Assessing Officer shall serve on
the assessee a notice of demand in the prescribed form specifying the sum
payable and such notice of demand shall be deemed to be a notice under section
156 and the provisions of this Act shall apply accordingly;
(ii) in a case where the interest is reduced, the excess interest
paid, if any, shall be refunded.
(5) The provisions of this section shall apply
in respect of assessments for the assessment year commencing on the 1st day of
April, 1989 and subsequent assessment years.]
[Interest for deferment of advance
tax.
234C. (1) [Where in any financial year,—
(a) the company which is liable to pay advance tax under section
208 has failed to pay such tax or—
(i) the
advance tax paid by the company on its current income on or before the 15th day
of June is less than fifteen per cent of the tax due on the returned income or
the amount of such advance tax paid on or before the 15th day of September is
less than forty-five per cent of the tax due on the returned income or the
amount of such advance tax paid on or before the 15th day of December is less
than seventy-five per cent of the tax due on the returned income, then, the
company shall be liable to pay simple interest at the rate of [one] per cent per month for a period of three
months on the amount of the shortfall from fifteen per cent or forty-five per
cent or seventy-five per cent, as the case may be, of the tax due on the
returned income;
(ii) the
advance tax paid by the company on its current income on or before the 15th day
of March is less than the tax due on the returned income, then, the company
shall be liable to pay simple interest at the rate of [one] per cent on the
amount of the shortfall from the tax due on the returned income:
Provided that if the advance tax paid by the company on its current income on or
before the 15th day of June or the 15th day of September, is not less than
twelve per cent or, as the case may be, thirty-six per cent of the tax due on
the returned income, then, it shall not be liable to pay any interest on the
amount of the shortfall on those dates;
(b) the assessee, other than a company, who is liable to pay
advance tax under section 208 has failed to pay such tax or,—
(i) the
advance tax paid by the assessee on his current income on or before the 15th
day of September is less than thirty per cent of the tax due on the returned
income or the amount of such advance tax paid on or before the 15th day of
December is less than sixty per cent of the tax due on the returned income,
then, the assessee shall be liable to pay simple interest at the rate of [one]
per cent per month for a period of three months on the amount of the shortfall
from thirty per cent or, as the case may be, sixty per cent of the tax due on
the returned income;
(ii) the
advance tax paid by the assessee on his current income on or before the 15th
day of March is less than the tax due on the returned income, then, the
assessee shall be liable to pay simple interest at the rate of [one] per cent
on the amount of the shortfall from the tax due on the returned income :]
[Provided that nothing contained in this sub-section
shall apply to any shortfall in the payment of the tax due on the returned
income where such shortfall is on account of under-estimate or failure to estimate—
(a) the amount of capital gains; or
(b) income
of the nature referred to in sub-clause (ix) of clause (24) of
section 2,
and the
assessee has paid the whole of the amount of tax payable in respect of income
referred to in clause (a) or clause (b), as the case may be, had
such income been a part of the total income, as part of the [remaining instalments of advance tax which are due or where no such
instalments are due], by the 31st day of March of the financial year:]
[Provided
further that nothing
contained in this sub-section shall apply to any shortfall in the payment of
the tax due on the returned income where such shortfall is on account of
increase in the rate of surcharge under section 2 of the Finance Act, 2000 (10
of 2000), as amended by the Taxation Laws (Amendment) Act, 2000 (1 of 2001),
and the assessee has paid the amount of shortfall, on or before the 15th day of
March, 2001 in respect of the instalment of advance tax due on the 15th day of
June, 2000, the 15th day of September, 2000 and the 15th day of December,
2000 :]
[Provided
also that nothing contained in this sub-section
shall apply to any shortfall in the payment of the tax due on the returned
income where such shortfall is on account of increase in the rate of surcharge
under section 2 of the Finance Act, 2000 (10 of 2000) as amended by the
Taxation Laws (Amendment) Act, 2001 (4 of 2001) and the assessee has paid the
amount of shortfall on or before the 15th day of March, 2001 in respect of the
instalment of advance tax due on the 15th day of June, 2000, the 15th day of
September, 2000 and 15th day of December, 2000.]
Explanation.—In this section, “tax due on the returned
income” means the tax chargeable on the total income declared in the return of
income furnished by the assessee for the assessment year commencing on the 1st
day of April imme-diately following the financial
year in which the advance tax is paid [or payable], as
reduced by [the amount of tax deductible or collectible at source in accordance
with the provisions of Chapter XVII on any income which is subject to such
deduction or collection] and which is taken into account in computing such
total income.
The following Explanation shall
be substituted for the existing Explanation to sub-section (1) of
section 234C by the Finance Act, 2006, w.e.f. 1-4-2007:
Explanation.—In this section, “tax due on
the returned income” means the tax chargeable on the total income declared in
the return of income furnished by the assessee for the assessment year
commencing on the 1st day of April immediately following the financial year in
which the advance tax is paid or payable, as reduced by the amount of,—
(i) any tax deductible or
collectible at source in accordance with the provisions of Chapter XVII on any income
which is subject to such deduction or collection and which is taken into
account in computing such total income;
(ii) any
relief of tax allowed under section 90 on account of tax paid in a country
outside India;
(iii) any relief of tax
allowed under section 90A on account of tax paid in a specified territory
outside India referred to in that section;
(iv) any
deduction, from the Indian income-tax payable, allowed under section 91, on
account of tax paid in a country outside India; and
(v) any tax credit allowed to be set off in accordance with the
provisions of section 115JAA.
(2) The
provisions of this section shall apply in respect of assessments for the
assessment year commencing on the 1st day of April, 1989 and subsequent
assessment years.]]
234D. (1) Subject to the other provisions of this
Act, where any refund is granted to the assessee under sub-section (1) of
section 143, and—
(a) no
refund is due on regular assessment; or
(b) the
amount refunded under sub-section (1) of section 143 exceeds the amount
refundable on regular assessment,
the assessee shall be liable to pay simple
interest at the rate of [one-half] per cent on the whole or the excess amount
so refunded, for every month or part of a month comprised in the period from
the date of grant of refund to the date of such regular assessment.
(2)
Where, as a result of an order under section 154 or section 155 or section 250
or section 254 or section 260 or section 262 or section 263 or section 264 or
an order of the Settlement Commission under sub-section (4) of section 245D,
the amount of refund granted under sub-section (1) of section 143 is held to be
correctly allowed, either in whole or in part, as the case may be, then, the
interest chargeable, if any, under sub-section (1) shall be reduced
accordingly.
Explanation.—Where, in relation to an assessment year, an assessment is made for the
first time under section 147 or section 153A, the assessment so made shall be
regarded as a regular assessment for the purposes of this section.]