Dear All my Professional colleague
Interest payable by bank of Financial institution on time deposit (i.e. FD) is liable for TDS deduction,
where as interest payable on RD (i.e. deposit other than time deposit) is not liable for TDS deduction.
Kindly refer provision of Sec. 194A(3)(vii) of the income tax act.
Sec. 194A. Interest other than “Interest on securities”.
(3) The provisions of sub-section (1) shall not apply—
[(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);