Amendment of section 194J.
71. In section 194J of the Income-tax Act, in sub-section (1), after clause (b), the following clause shall be inserted with effect from the 1st day of July, 2012, namely:—
“(ba) any remuneration or fees or commission by whatever name called, other than those on which tax is deductible under section 192, to a director of a company; or”.
Notes on Clauses:
Clause 71 of the Bill seeks to amend section 194J of the Income-tax Act relating to fees for professional or technical services.
The existing provisions in sub-section (1) of the aforesaid section 194J provide that a person, not being a individual or a Hindu undivided family, who is responsible for paying to a resident any sum by way of fees for professional services, fees for technical services royalty or sums referred to in clause (va) of section 28 shall deduct an amount equal to ten per cent. of such sum as income tax.
It is proposed to amend the aforesaid sub-section (1) to insert a new clause (ba) so as to provide that the person referred to in sub-section (1) of the aforesaid section who is responsible for paying to a director of a company any sum by way of any remuneration or fees or commission, by whatever name called (other than those on which tax is deductible under section 192), shall deduct an amount equal to ten per cent. of such sum as income-tax in accordance with the provisions of the aforesaid section.
This amendment will take effect from 1st July 2012.
