Tds return - lower tax deduction u/s 197

This query is : Resolved

Nandakumar K Konkar (Querist)
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06 July 2012 Friends,
TDS return has a column for specifying reason for lower or higher tax deduction as under:
A - No deduction
B- Lower deduction u/s 54H & 54J
C- Higher rate
Y- Threshold.

There is no provision for specifying reason for lower deduction u/s 197, so how do we give this reason in TDS return?
Your advise is welcome.
CA N Konkar

prashant

prashant (Expert)
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06 July 2012 Dear friend,

According to me,

The filling of the TDS return is governed by sec 206 and the prescribed rules their on.

The verbatium of the rule 31A of income tax is as follows

(v) furnish particulars of amount paid or credited on which tax was not deducted in view of the issue of certificate of no deduction of tax under section 197 by the Assessing Officer of the payee;

(vi) furnish particulars of amount paid or credited on which tax was not deducted in view of the compliance of provisions of sub-section (6) of section 194C by the payee;]

vii) furnish particulars of amount paid or credited on which tax was not deducted in view of the furnishing of declaration under sub-section (1) or sub-section (1A) or sub-section (1C) of section 197A by the payee.]

source: http://law.incometaxindia.gov.in/DIT/File_opener.aspx?page=ITRU&schT=rul&csId=acc2b1fb-d694-4f7f-bd00-3677ec14710e&rNo=31&sch=&title=Taxmann - Direct Tax Laws

Nandakumar K Konkar

Nandakumar K Konkar (Querist)
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07 July 2012 Dear Prashant,
I am having a case where the deductee has furnished certificate u/s 197 for TDS deduction u/s 194J at very low rate of 0.01% instead of normal rate of 10%.
So how do we flag this case in TDS return, since this is not a case of non-deduction but deduction at very nominal rate? The option of 'B' mentions Form 15H & 15G only.
Pls advise.

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