14 June 2013
Section 194A(3)(iii) allows payment without TDS, if made to Notified Institutions, which includes Banking Company to which Banking Regulations Act, 1949 applies, LIC, UTI, etc.
But to my understanding section 194A(3)(iii) does not cover other financial institutions. Is there any other relaxation available for such Interest payment?
As we all know that Interest (Other than Interest on Securities) is liable for TDS u/s 194A The repayment of such financed amount are made in EMI, which includes principal+Interest. Such Interest normally crosses Rs.5000/- in a year.
So whether TDS is applicable on Interest payment made to such institutions?