Income Tax Act (hereinafter referred as ‘The Act’) has provided several provisions for deduction/ collection of tax at source. Rates at which Tax is supposed to be deducted are provided in Section 192, 193, 194 and 195 (for non-residents). Person making the payment is responsible for deducting of taxes before making the payment.
However, there are certain cases where this might create genuine hardship for the taxpayers. These can be as follows:
Undoubtedly taxpayer can claim refund of the TDS/TCS amount but it is unnecessary blockage of funds.
Therefore, so as to remove unjust hardship for taxpayers, government provided Section 197 of The Act, wherein the taxpayer can obtain a Certificate for lower from Assessing Officer.
Section 197 covers following sections of tax deduction only:
There is no such fixed time limit so as to obtain certificate for lower tax deduction, however, as TDS is an on-going activity, it is always advisable to obtain such certificate at the beginning of the financial year.
A set of documents along with the application is to be made in Form 13 with the respective assessing officer. As of now, only regions of Karnataka, Mumbai and Tamil Nadu have enabled electronic filing of Form 13. Following documents are required to be submitted:
Once the application is received with the relevant documents by the jurisdictional assessing officer, he shall either call for more information and upon his satisfaction shall issue the certificate of lower deduction.
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