Amendment of section 194N.
85. In section 194N of the Income-tax Act, after the second proviso, the following proviso shall be inserted, namely:––
“Provided also that where the recipient is a co-operative society, the provisions of this section shall have effect, as if for the words “one crore rupees”, the words “three crore rupees” had been substituted.”.
Notes on Clauses:
Clause 85 of the Bill seeks to amend section 194N of the Income-tax Act relating to payment of certain amounts in cash.
The provisions of the said section provide that a banking company or a co-operative society engaged in carrying on the business of banking or a post office, which is responsible for paying any sum, being the amount or the aggregate of amounts, in excess of one crore rupees in cash during the previous year to any person (referred to as the recipient) from one or more accounts maintained by the recipient with it shall, at the time of payment of such sum, deduct an amount equal to two per cent. of such sum, as income-tax.
It is proposed to insert a third proviso in the said section so as to provide that where the recipient is a co-operative society, the provisions of this section shall have effect, as if for the words “one crore rupees” the words “three crore rupees” had been substituted.
This amendment will take effect from 1st April, 2023.
