No deduction of tax in certain cases.
200. Notwithstanding anything in section 195, no tax shall be deducted at source,
(A) where the payee is a resident, from the following, namely:
(a) any payment, other than salary, made by an individual or a Hindu undivided family, if the individual or the Hindu undivided family is not liable to get the accounts audited under section 88 for the financial year immediately preceding the financial year in which the payment is made;
(b) any interest payable on any security,
(i) of the Central Government or a State Government; or
(ii) issued by a company, if such security is in dematerialised form and is listed on a recognised stock exchange in India;
(c) any interest on debenture payable to an individual, if
(i) the debentures are issued by a widely held company;
(ii) the debentures are listed in a recognised stock exchange in India; and
(iii) the aggregate amount payable during the financial year does not exceed five thousand rupees;
(d) any interest on time deposits (being deposits repayable on the expiry of fixed periods, excluding recurring deposits) payable, if
(i) the time deposits are made with a banking company or a cooperative bank or a housing-finance public company; and
(ii) the aggregate amount payable by the payer, being a branch of the bank or company during the financial year, does not exceed ten thousand rupees;
(e) any other interest payable if the aggregate amount of the payments during the financial year does not exceed five thousand rupees;
(f) any interest payable to,
(i) any banking company;
(ii) any co-operative bank;
(iii) any financial corporation established by or under a Central or State or Provincial Act;
(iv) any insurer;
(v) any mutual fund; or
(vi) any institution, association or body, or class of institutions, associations or bodies, which the Central Government may, for reasons to be recorded in writing, notify in this behalf;
(g) any interest payable by a firm to a partner of the firm;
(h) any interest payable in respect of deposits under any scheme framed by the Central Government and notified by it in this behalf;
(i) any interest payable in respect of deposits (other than time deposits) with a banking company or a co-operative bank;
(j) any interest payable by the Central Government under any provision of this Code or the Income-tax Act, 1961, or the Wealth-tax Act, 1957, as they stood before the commencement of this Code;
(k) any interest payable on the amount of compensation awarded by the Motor Accidents Claims Tribunal, if the aggregate of the amounts of such interest paid, or credited, during the financial year does not exceed one lakh rupees;
(l) any amount payable on maturity, or redemption, of a zero coupon bond;
(m) any payment for carriage of goods by road transport if the payee furnishes his permanent account number to the payer;
(n) any payment to a contractor in respect of works contract, service contract, advertising, broadcasting and telecasting, supply of labour for carrying out any works, or service, contract or carriage of goods or passengers by any mode of transport, other than by railways, if
(i) the amount of any payment during the financial year does not exceed thirty thousand rupees; and
(ii) the aggregate amount of the payments during the financial year does not exceed seventy-five thousand rupees;
(o) any payment of commission or brokerage, if the aggregate amount of the payments during the financial year does not exceed five thousand rupees;
(p) any payment of rent, if the aggregate amount of the payments during the financial year does not exceed one lakh eighty thousand rupees;
(q) any payment of compensation on compulsory acquisition of immovable property, if the aggregate amount of the payments during the financial year does not exceed two lakh rupees;
(r) any amount payable by way of distribution of income by a mutual fund in respect of a fund, not being an equity oriented fund, to any unitholder, if,
(i) such unitholder is not a company; and
(ii) the aggregate amount of the payment to the unitholder during the financial year does not exceed ten thousand rupees;
(s) any amount payable, by a life insurer to any policy-holder, if,
(i) such policy-holder is not a company;
(ii) the policy is other than a policy referred to in clause (d) or clause (e) of sub-section (3) of section 59; and
(iii) the aggregate amount of the payment to the policy-holder during the financial year does not exceed ten thousand rupees;
(B) where the payee is a non-resident, being a foreign institutional investor, on any payment made to it as a consideration for sale of securities listed on a recognised stock exchange.
