Instructions regarding deduction of tax at source from payments in respect of deposits under NSS, etc.
Circular : No. 618, dated 22-11-1991.
1. The Finance (No. 2) Act, 1991 has inserted a new section 194EE in the Income-tax Act, 1961 with effect from the 1st October, 1991, which reads as follows :
“194EE. The person responsible for paying to any person any amount referred to in clause (a) of sub-section (2) of section 80CCA shall, at the time of payment thereof, deduct income-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 :