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TMI BlogDeduction of tax at source from withdrawals of deposits made in the National Savings Scheme--Section 194EE of the Income-tax Act, 1961--Instructions regardingX X X X Extracts X X X X X X X X Extracts X X X X ..... e-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 . 2. The new section requires every person responsible for paying any amounts referred to in clause (a) of sub-section (2) of section 80CCA of the Income-tax Act (e.g., withdrawals under the National Savings Scheme) to deduct income-tax at source at the rate of 20% of the amounts paid. Presently, the National Savings Scheme (NSS) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r as for example, the income-tax deducted from the salaries payable to the employees is credited to the Government account. In case of failure to deduct tax at source, the payer will be liable under section 201 to pay simple interest at the rate of 15% 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 to the Government account. In addition, he will also be liable to pay, by way of penalty, under section 271C a sum equal to the amount of tax which he failed to deduct at source. In case of failure to pay the tax to the credit of the Central Government within the prescribed time, similar penal provisions, including prosecution, under section 276B are attracted. (b) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of every office of Government, the principal officer in the case of every company, etc., responsible for deducting tax is required to prepare and deliver, or cause to be delivered, to the designated/ concerned Assessing Officer by the prescribed date after the end of the financial year, an annual return of deduction of tax under section 194EE in the prescribed form. The form in which the return has to be filed and the due date for filing it are being notified. If a person fails to furnish in due time, the annual return, he shall be liable to pay, by way of penalty, a sum which shall not be less than Rs. 100 but which may extend to Rs. 200 for every day, during which the failure continues; so, however, that this sum shall not exceed the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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