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2021 (10) TMI 73 - HC - Income TaxReturn of TDS amount deducted u/s 194A on award passed under motor insurance act - seeking release of amount deducted by the non-applicant/Insurance Company on account of 20% TDS from the interest earned on the awarded amount - HELD THAT:- Deduction made by the non-applicant/Insurance company is not in due adherence to the clause ix (a) of Section 194-A of Income Tax Act, 1961, as same has to be applied on the awarded amount proportionately in favour of the claimants with spread of years from which the claim is made. In terms of the application of provision of law quoted above, the proportionate valuation of the entitlement of the interest amount to the awarded amount is ₹ 7000 per claimant, therefore, the same does not exceed ₹ 50,000/- which can be taxable by application of Clause ix (a) of Section 194-A of Income Tax, 1961. This application is allowed and the Registry is directed to release the amount deposited by the non-applicant/Insurance Company, on account of deduction of tax on interest amount in favour applicants-claimants. The amounts shall be released in favour of the applicants/claimants through their counsel on proper identification and verification. The non-applicant/Insurance Company is at liberty to seek withdrawal of the amount so deposited with the Income Tax Department and the Income Tax Department shall release the deducted amount as and when such requisition is made by the non-applicant/Insurance Company.
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