Amendment of section 206AB.
89. In section 206AB of the Income-tax Act, in sub-section (3), for the proviso, the following proviso shall be substituted, namely:––
“Provided that the specified person shall not include––
(i) a non-resident who does not have a permanent establishment in India; or
(ii) a person who is not required to furnish the return of income for the assessment year relevant to the said previous year and is notified by the Central Government in the Official Gazette in this behalf.”.
Notes on Clauses:
Clause 89 of the Bill seeks to amend section 206AB of the Income-tax Act relating to special provision for deduction of tax at source for non-filers of income-tax return.
Sub-section (3) of the said section defines “specified person” for the purpose of this section to mean a person who has not furnished the return of income for the assessment year relevant to the previous year immediately preceding the financial year in which tax is required to be deducted. The proviso to the said sub-section excludes a non-resident from the definition of specified person, if the non-resident does not have a permanent establishment in India.
It is proposed to amend the said proviso to also exclude a person who is not required to furnish the return of income for the assessment year relevant to the said previous year and is notified by the Central Government in the Official Gazette in this behalf.
This amendment will take effect from 1st April, 2023.
