INCOME TAX

Issue of certificate for deduction of tax at source at lower/nil rate

INSTRUCTION NO. 5153/1993

 Dated: March 2, 1993

Section(s) Referred: 197(1)

Statute: Income - Tax Act, 1961

I am directed to say that the provisions of section 197(1) of the I.T. Act, 1961 have been amended by the Finance Act, 1992 w.e.f. 1-6-1992 so as to enable any person (including a company) to make an application to the Assessing Officer for issue of a certificate for deduction of tax at source at a lower/nil rate in respect of income qualifying for TDS under the provisions of section 192, 193, 194A, 194D and 195 of the Act. Prior to 1-6-1992, these provisions were applicable in the case of such income of any person other than a company. Now, with the aforesaid amendment, the relevant Form No. 15AA in which the aforesaid certificate is issued by the Assessing Officer has also been amended by the Income-tax(20th Amendment) Rules, 1992 dated the 23rd December, 1992 so as to enable the Assessing Officer to issue the desired certificate also in cases where the applicant is a company.

2. Instances have come to the notice of the Board, after coming into force of the aforesaid amendment of section 197(1) of the Act, where the Assessing Officer has not issued the said certificate in the prescribed Form (No.15AA) but in the form of a simple letter/order to an applicant company. The Board desire that you may kindly bring to the notice of all the Assessing Officers in your region/charge, the amendment made in the relevant provisions of the Act and Rules in this regard. A copy of the Income-tax(20th Amendment) Rules, 1992 dated 23rd December, 1992, published in the Gazette of India Extraordinary is also enclosed for information and necessary action. The relevant amendment in Form No.15AA is contained in para 2(D)(d) of the Notification. The new Form No.15AA is same as the existing Form 15AA except that in the title, the words and figures 'Section 197(1)(a)' have been replaced by 'Section 197(1).

F.No. 275/1/93-IT(B)