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CBDT: 'PAN' - sufficient input under new functionality for ascertaining TDS rate on cash withdrawals u/s. 194N

 

Government of India

Department of Revenue

Ministry of Finance

Central Board of Direct Taxes

New Delhi, 12th July, 2020

PRESS RELEASE

CBDT provides Utility to ascertain TDS applicability rates on cash withdrawals

The Income Tax Department has facilitated a new functionality for Banks and Post offices through which they can ascertain the TDS applicability rates on cash withdrawal of above Rs.20 lakh in case of a non-filer of Income Tax Return (ITR) and that of above Rs. 1 crore in case of a filer of the ITR. So far, more than 53,000 verification requests have been executed successfully on this facility.

This functionality has been available as “Verification of applicability u/s 194N” on www.incometaxindiaefiling.gov.in since 1st July, 2020 and has also been made available to the Banks through web-services, so that the entire process can be automated and be linked to the Bank’s internal core banking solution.

It is stated that now the Bank/Post Office has to only enter the PAN of the person who is withdrawing cash for ascertaining the applicable rate of TDS. On entering PAN, a message will be instantly displayed on the departmental utility: “TDS is deductible at the rate of 2% if cash withdrawal exceeds Rs. 1 crore” [if the person withdrawing cash is a filer of ITR] and “TDS is deductible at the rate 2% if cash withdrawal exceeds Rs. 20 lakh and at the rate of 5% if it exceeds Rs. 1 crore” [if the person withdrawing cash is a non-filer of ITR].

It is further stated that the data on cash withdrawal indicated that huge amount of cash is being withdrawn by the persons who have never filed Income Tax Returns. To ensure filing of return by these persons and to keep track on cash withdrawals by the non-filers, and to curb black money, the Finance Act, 2020 w.e.f. 1st July, 2020 further amended Income-tax Act, 1961 to lower the threshold of cash withdrawal to Rs. 20 lakh for the applicability of this TDS for non-filers and also mandated TDS at a higher rate of 5% on cash withdrawal exceeding Rs. 1 crore by the non-filers.

It may be noted, that, in order to discourage cash transactions and move towards less-cash economy, the Finance (No.2) Act, 2019 had inserted section 194N in the Income-tax Act, 1961 w.e.f. 1st September, 2019 to provide for levy of TDS @ 2% on cash withdrawal exceeding Rs. 1 crore from a Bank/Post Office account/s subject to certain exceptions.

(Surabhi Ahluwalia)

Commissioner of Income Tax

(Media & Technical Policy)

Official Spokesperson, CBDT

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CBDT-SEBI sign MoU today for data sharing

 

Government of India

Department of Revenue

Ministry of Finance

Central Board of Direct Taxes

New Delhi, 8th July, 2020

PRESS RELEASE

Memorandum of Understanding(MoU) between CBDT and SEBI signed today

A formal Memorandum of Understanding (MOU) was signed today between the Central Board of Direct Taxes (CBDT) and the Securities and Exchange Board of India (SEBI) for data exchange between the two organizations. The MoU was signed by Smt. Anu J Singh, Pr. DGIT (Systems), CBDT and Smt. Madhabi Puri Buch, Whole Time Member, SEBI in the presence of senior officers from both the organizations via video conference.

The MoU will facilitate the sharing of data and information between SEBI and CBDT on an automatic and regular basis. In addition to regular exchange of data, SEBI and CBDT will also exchange with each other, on request and suo moto basis, any information available in their respective databases, for the purpose of carrying out their functions under various laws.

The MoU comes into force from the date it was signed and is an ongoing initiative of CBDT and SEBI, who are already collaborating through various existing mechanisms. A Data Exchange Steering Group has also been constituted for the initiative, which will meet periodically to review the data exchange status and take steps to further improve the effectiveness of the data sharing mechanism.

The MoU marks the beginning of a new era of cooperation and synergy between SEBI and CBDT.

 

(Surabhi Ahluwalia)

Commissioner of Income Tax

(Media & Technical Policy)

Official Spokesperson, CBDT

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Ministry of Finance - Govt. has no proposal to merge CBDT, CBIC; Slams ‘misleading’ media reports

 

Ministry of Finance

News report of Merger of two Boards of Revenue factually incorrect

Government has no proposal to merge two Boards created under the Central Boards of Revenue Act, 1963

Dated: 06 JUL 2020

A news item has been published today in a leading newspaper that the Government is considering proposal to merge the Central Board of Direct Taxes and Central Board of Indirect Taxes and Customs. This news item is factually incorrect as the Government has no proposal to merge the two Boards created under the Central Boards of Revenue Act, 1963. It has been published without due verification of facts from the competent authorities of Ministry of Finance and only creates a policy distraction when the Ministry is amidst implementation of a large number of taxpayers’ friendly reforms like transition from manual assessment based on territorial jurisdiction to a completely randomized electronic faceless assessment, electronic verification or transactions and faceless appeals.

As pointed out in the report, the said merger was one of the recommendations of the Tax Administrative Reforms Commission (TARC). The report of TARC was examined in detail by the Government and this recommendation of TARC was not accepted by the Government. As a part on an assurance made by the Government in the Parliament in response to a Parliament question, the Government has also placed this fact in 2018 before the Committee on Government Assurances. The action taken report on the recommendations of the TARC is placed even on the website of Department of Revenue, which clearly shows that this recommendation was not accepted.

It is evident that this misleading article has been published with no due diligence of even checking official records placed in the public domain or checking the latest status with relevant competent authorities in the Ministry of Finance. It not only reflects poorly on the quality of journalism but also shows a complete disregard for due diligence. If such an unverified story is given a front-page lead story position, it should be a concern for all news reading public. This news item is completely rejected as baseless and unverified.

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RM/KMN

(Release ID: 1636793)

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Income Tax Department Refunded Rs. 62,361 crore to more than 20 lakh taxpayers during Covid days

 

Government of India

Department of Revenue

Ministry of Finance

Central Board of Direct Taxes

New Delhi, 3rd July, 2020

PRESS RELEASE

Income Tax Department Refunded Rs. 62,361 crore to more than 20 lakh taxpayers during Covid days

In pursuance to the Government’s decision vide Press Note dated April 8th, 2020 to issue pending income tax refunds in order to help taxpayers in a Covid-19 pandemic situation, the Income Tax Department has issued tax refunds at a speed of 76 cases per minute from 8th April to 30th June, 2020. During this period of just 56 weekdays, the Central Board of Direct taxes (CBDT) has issued refunds in more than 20.44 lakh cases amounting to more than Rs. 62,361 crore.

It is stated that taxpayers are experiencing this facet of the I-T Department which is not only taxpayer-friendly, but also that of a facilitator providing liquidity in this hard time of Covid-19 pandemic. Income tax refunds amounting to Rs. 23,453.57 crore have been issued in 19,07,853 cases to taxpayers and corporate tax refunds amounting to Rs. 38,908.37 crore have been issued in 1,36,744 cases to taxpayers during this period.

Refunds of this magnitude and numbers have been issued completely electronically and have been directly deposited into the bank accounts of the taxpayers. Unlike what used to happen some years ago, in these refund cases, no taxpayer had to approach the Department to request for release of refund. They got refunds directly into their bank accounts.

CBDT reiterated that taxpayers should provide immediate response to emails of the Department so that refunds in their cases too could be processed and issued right away. Such emails of I-T Department seek taxpayers to confirm their outstanding demand, their bank account number and reconciliation of defect/mismatch prior to issue of refund. In all such cases, quick responses from the taxpayers would enable the I-T Department to process their refunds expeditiously.

(Surabhi Ahluwalia)

Commissioner of Income Tax

(Media & Technical Policy)

Official Spokesperson, CBDT

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Introduction of Floating Rate Savings Bonds, 2020 (Taxable)

Press Information Bureau
Government of India
Ministry of Finance

Dated: 26 JUN 2020

Introduction of Floating Rate Savings Bonds, 2020 (Taxable)

The Government has notified the new Floating Rate Savings Bonds, 2020 (Taxable)Scheme in place of 7.75 percent Savings (Taxable) Bonds, 2018Scheme which ceased for subscription from the close of banking business on May 28, 2020. The broad features of thenew Floating Rate Savings Bonds, 2020 (Taxable) scheme are given below: 

Sl. No.

Item

Details

1.

Scheme name

Floating Rate Savings Bonds, 2020 (Taxable)

2.

Issuance

To be issued by Reserve Bank India on behalf of the Government of India.

3.

Eligibility

The Bonds may be held by -

(i)   a person resident in India,-

(a)          in his individual capacity, or

(b)          in individual capacity on joint basis, or

(c)          in individual capacity on any one or survivor basis, or

(d)          on behalf of a minor as father/mother/legal guardian

(ii)      a Hindu Undivided Family.

Explanation: For the purpose of this paragraph, the “person resident in India” shall have the same meaning as defined in clause (v) of Section 2 of the Foreign Exchange Management Act 1999(42 of 1999)

4.

Issue price/ Denomination/ Minimum Subscription

The Bonds will be issued at parat Rs.100/-for a minimum amount of Rs.1000/- (nominal value) and in multiples thereof.

5.

Date of Issue

The Bonds, in the form of Bonds Ledger Account, will be opened (issued) from the date of tender of cash (up to Rs.20,000/- only), or date of realization of cheque/draft/funds.

6.

Maximum limit

There will be no maximum limit for investment in the Bonds.

7.

Forms/Certificate

The Bonds will be issued only in the form of Bond Ledger Account and may be held at the credit of the holder in an account called Bond Ledger Account (BLA). The investors will be issued a Certificate of Holding for the same.

8.

Payment option

Subscription to the Bonds will be in the form of Cash(uptoRs.20,000 only)/drafts/cheques or any electronic mode acceptable to the Receiving Office.Cheques or drafts should be drawn in favour of the Receiving Office and payable at the place where the applications are tendered.

 

 

 

9.

Repayment/Tenor

The Bonds shall be repayable on the expiration of 7 (Seven) years from the date of issue. Premature redemption shall be allowed for specified categories of senior citizens.

10.

Receiving Offices

Applications will be received at the branches of SBI, Nationalised banks and specifiedprivate sector banks, either directly or through their agents.

11.

Interest Rate(Floating)

The interest on the bonds is payable semi-annually on 1st Jan and 1st July every year.The coupon on 1st January 2021 shall be paid at 7.15%. The Interest rate for next half-year will be reset every six months, the first reset being on January 01, 2021. There is no option to pay interest on cumulative basis.

12.

Tax treatment

Interest on the Bonds will be taxable under the Income-tax Act, 1961as amended from time to time and as applicable according to the relevant tax status of the Bonds holder.

13.

Transferability

The Bonds in the form of Bond Ledger Account shall not be transferableexcept transfer to a nominee(s)/legal heir in case of death of the holder of the bonds

14.

Nomination

A sole holder or all the joint holders of Bonds, being individual/s, may nominate in Form C or as near thereto as may be, one or more persons who shall beentitled to the Bonds and the payment there on, in the event of his/their death.

15.

Tradability /Advances

The Bonds shall not be tradable in the secondary market and shall not be eligible as collateral for loans from banks, financial Institutions and Non-Banking Financial Company (NBFC) etc.

16.

Brokerage/Commission

Brokerage at the rate of 0.5% of the amount mobilized will be paid to the Receiving Offices and they shall share at least 50% of the brokerage so received with brokers/sub brokers registered with them.

 

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