TDS on interest payable under Senior Citizens Savings Scheme -Non-acceptance of Form No. 15 H and 15 G by Banks- RBI clarifies stand
The Reserve Bank has informed the Banks that the Finance Ministry has informed them that they are receiving a number of complaints / grievances regarding non-acceptance of Form No. 15G or 15H by the Agency banks and that tax is being deducted from the interest amounts despite the depositor filing or submitting these forms.
RBI has reiterated the stand that Agency banks should not make any deduction of tax at source where depositor is filing Form 15H or Form 15G or a certificate under Section 197(1) of Income Tax Act 1961.
RBI wants the Banks to comply with these instructions.
RBI/ 2006-07/ 171 Dated: November 10, 2006