11 December 2012
As per section 80TTA inserted w.e.f. AY 13-14, provides deduction upto Rs. 10,000 in respect of income by way of interest on deposits (not being time deposits) in a savings account with - (one of them being) a banking company. Now "not being time deposits" means "Fixed Deposits". Would "Recurring Deposits" also fall under "time deposits"?. If yes, then it means, in a layman's language, only interest on balance in bank savings account is exempted from tax upto Rs. 10K.