Liability to deduct tds on interest on cpf account by bank

This query is : Resolved

Harsh Goyal (Querist)
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11 February 2014 Sir,

I want to know whether a bank is liable to deduct TDS on interest on CPF account of any person with the bank.

C A S.S.Agarwal, M.Com.,LL.B,

C A S.S.Agarwal, M.Com.,LL.B, (Expert)
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11 February 2014 No TDS is applicable on PF as it is exempted from Tax. Bank do not maintain any account of PF it is maintained by Commissioner of Providend Fund.

Payment from provident fund is exempt to the extent provided in sec. 10(11) & sec. 10(12).

Any payment received from a Statutory Provident Fund (SPF), is exempt.

Any payment from any other provident fund notified by the Central Government is also exempt. The Public Provident Fund (PPF) established under the PPF Scheme, 1968 has been notified for this purpose.

Provisions
Payment received from Provident Fund u/s. 10 (11), (12) • Any payment from a provident fund to which the provident fund Act ,1925 applies or from any other provident fund set up by Central Govt. and notified in the official gazette is totally exempted from tax. • Section 10 (12) Accumulated balance due and become payable to an employee participating in a recognised provident fund, is exempt from tax