Deduction of tax from winnings from horse races. - Income Tax - 1262/CBDT

INSTRUCTION NO. 1262/CBDT Dated : June 4, 1979 Section(s) Referred: 194BB Statute: Income - Tax Act, 1961 I am directed to invite a reference to the Board's Instruction No.*1199 (F.No.275/20/78-ITB), dated the 10th August, 1978 regarding deduction of tax at source from winnings from horse races as required under section 194BB of the Income-tax Act, 1961. 2. The income-tax is deductible at source only where the income by way of winnings from any horse race in an amount exceeding Rs.2,500 is paid by any book-maker or a race club. The provisions of section 194BB are applicable in the case of resident as well as non-resident tax-payers. The rates for deduction of tax at source for the financial year 1979-80 have been prescribed in Part II of the First Schedule to the Finance Act, 1979 and are as follows:- Rates of Income-tax including surcharge (i) In the case of person other than a company: (a) Where the person is resident 36%(IT 30% +S.C.6%) (b) Where the person is not resident in India 36%(IT30%+S.C.6%) OR income-tax and surcharge on income-tax in respect of the income at the rates prescribed in Sub-Paragraph I of the Pargraph A of Part III of the First Schedule to the Finance Act, 1979 if the income by way of winnings from horse race had been the total income, whichever is higher. (ii) In case of a company : (a) where the company is a domestic company. 24%(IT22.5%+S.C.1.5%) (b) where the company is not a domestic company. 75.25%(IT70%+S.C.5.25)% 3. This being a provision introduced only last year it is necessary that a close supervision and control is exercised over its implementation. You may kindly make adequate arrangements for ensuring that the book-makers and the race clubs deduct the tax at source regularly and pay the same to the credit of the Central Government within the time, namely, within one week from the date of deduction or the date of the receipt of chalan. Income-tax Officers may also be instructed to supply sufficient number of challans to the book-makers/race clubs within their respective jurisdiction. As requested last year the survey might have been conducted in your charge and the persons responsible for paying the tax from winnings from horse races identified. The Board hopes that a close watch will be kept over the timely deduction and payment of tax by such persons and also the timely receipt of the prescribed quarterly statement in Form No.26BB on a continuing basis by the officers concerned.