Deduction of tax at source, as per the rates specified in the section, to be increased by a surcharge at the rate of 5 per cent – Effective from16-12-1987
Circular : No.505 [F.No. 275/20/88-IT(B)], dated 19-2-1988.
1. According to the provisions of section 194C any person responsible for paying any sum to any resident contractor for carrying out any work in pursuance of a contract between the contractor and the agencies specified therein shall, at the time of credit of such sum to the account of the contractor or payment thereof in cash, etc., deduct an amount equal to 2 per cent of such sum as income-tax on income comprised therein. The agencies are :