Section 197 of the Income-tax Act, 1961 – Deduction of tax at source – Certificate of lower deduction or non-deduction of tax at source
Dec 26, 2009 Income Tax
Instruction No. 7/2009 [F.No. 275/23/2007- IT-(B)], dated 22-12-2009
I am directed to bring to your notice on the subject of issue of certificates under Section 197. Instruction No- 8/2006 dated 13.10.2006, was issued stating that 197 certificates for lower deduction or nil deduction of TDS u/s 197 are not to be issued indiscriminately and for issue of each certificate, approval of the JCI/Add. CIT concerned need to be taken by the Assessing Officer (AO). Further, a letter of even number dated 6.10.2008 was issued stating that power of issue of certificates under Section 197 would ordinarily be exercised by the officers manning TDS Administration. However, instances are being brought to the notice of Board that the AOs are issuing certificates for lower or non-deduction of tax at source under Section 197 indiscriminately, in contravention of relevant Income Tax Rules and Instructions.
I am, therefore, directed to communicate to you that further to the contents of Instruction No-8/2006, prior administrative approval of the Commissioner of Income Tax (TDS) shall be taken (where the cumulative amount of tax foregone by non-deduction/ lesser rate of deduction of tax arising out of certificate under Sec, 197 during a financial year for a particular assessee exceeds Rs. 50 lakh in Delhi, Mumbai, Chennai, Kolkata, Bangalore, Hyderabad, Ahmadabad and Pune stations and Rs. 10 lakh for other stations. Once the CIT (TDS) gives administrative approval of the above, a copy of it has to be endorsed invariably to the jurisdictional CIT also.
The content of the above instruction may be brought to notice of all officers working in your charge for strict compliance.
Tags: administrative approval, certificate for lower deduction of tds, compliance section, income tax act, income tax act 1961, income tax rules, lower deduction certificate, Nil or law rate tds certificate, section 19
June 6th, 2010 at 3:16 pm
under which circumstances a duductee can ask for deduction at lowe rate ? and what kind of documents should a duductee submit to get tds deducted at lower rate u/s. 197 of income tax act? please make it clear to me
July 3rd, 2010 at 3:15 pm
Circumstances: When the assessee or his representative is willing to pay money to officers ranging from ITO to CIT…or if he has got big political reference.
Documents required: mainly currency Notes
My apologies to sound circastic. However, the ground reality is so pathetic.Even very genuine requests are being rejected or delayed on flimsy grounds unless people are entertained. pls refer to the recent Mumbai HC comments in the case of L&T