Section 194N TDS Query

TDS shall be deducted by banks, co-operative societies in banking business and post offices @ 2% on cash withdrawals exceeding 1 crore during a financial year

A provision has been inserted stating that :

"Provided that in case of recipient who has not filed returns of income for all of the three assessement years relevant to three previous years....... "

in such case TDS shall be deducted -

2% for cash withdrawals exceeding 20 lakha but less than 1 crore (or)

5 % for cash withdrawals exceeding 1 crore

𝗤𝘂𝗲𝗿𝘆 : 𝗦𝗵𝗼𝘂𝗹𝗱 𝗜𝗧 𝗿𝗲𝘁𝘂𝗿𝗻𝘀 𝗯𝗲 𝗳𝗶𝗹𝗲𝗱 𝗳𝗼𝗿 𝗮𝗹𝗹 𝟯 𝗽𝗿𝗲𝘃𝗶𝗼𝘂𝘀 𝘆𝗲𝗮𝗿𝘀 𝗽𝗿𝗶𝗼𝗿 𝘁𝗼 𝘁𝗵𝗲 𝘆𝗲𝗮𝗿 𝘄𝗵𝗲𝗿𝗲 𝘄𝗶𝘁𝗵𝗱𝗿𝗮𝘄𝗮𝗹𝘀 𝗼𝗰𝗰𝘂𝗿 𝘁𝗼 𝗮𝗹𝗹𝗼𝘄 𝗱𝗲𝗱𝘂𝗰𝘁𝗶𝗼𝗻 𝗹𝗶𝗺𝗶𝘁 𝗼𝗳 𝟭 𝗰𝗿𝗼𝗿𝗲 𝗮𝗻𝗱 𝘁𝗮𝘅 𝗿𝗮𝘁𝗲 𝗼𝗳 𝟮% ? (𝗼𝗿)

𝗛𝗶𝗴𝗵𝗲𝗿 𝗱𝗲𝗱𝘂𝗰𝘁𝗶𝗼𝗻 𝗹𝗶𝗺𝗶𝘁 𝗰𝗮𝗻 𝗯𝗲 𝗮𝗹𝗹𝗼𝘄𝗲𝗱 𝗜𝗳 𝘁𝗵𝗲 𝗰𝘂𝘀𝘁𝗼𝗺𝗲𝗿 𝗳𝗶𝗹𝗲𝘀 𝗜𝗧 𝗿𝗲𝘁𝘂𝗿𝗻 𝗳𝗼𝗿 𝗮𝗻𝘆 𝗼𝗻𝗲 𝘆𝗲𝗮𝗿 𝗼𝘂𝘁 𝗼𝗳 𝘁𝗵𝗲 𝟯 𝗽𝗿𝗲𝘃𝗶𝗼𝘂𝘀 𝘆𝗲𝗮𝗿𝘀 𝗽𝗿𝗶𝗼𝗿 𝘁𝗼 𝘁𝗵𝗲 𝘆𝗲𝗮𝗿 𝘄𝗵𝗲𝗿𝗲 𝘄𝗶𝘁𝗵𝗱𝗿𝗮𝘄𝗮𝗹𝘀 𝗼𝗰𝗰𝘂𝗿 ?

𝗧𝗵𝗲𝗿𝗲 𝗶𝘀 𝗮𝗺𝗯𝗶𝗴𝘂𝗶𝘁𝘆 𝗶𝗻 𝘁𝗵𝗲 𝘄𝗼𝗿𝗱𝘀 " 𝗿𝗲𝗰𝗶𝗽𝗶𝗲𝗻𝘁 𝘄𝗵𝗼 𝗵𝗮𝘀 𝗻𝗼𝘁 𝗳𝗶𝗹𝗲𝗱 𝗿𝗲𝘁𝘂𝗿𝗻𝘀 𝗼𝗳 𝗶𝗻𝗰𝗼𝗺𝗲 𝗳𝗼𝗿 𝗮𝗹𝗹 𝗼𝗳 𝘁𝗵𝗲 𝘁𝗵𝗿𝗲𝗲 𝗮𝘀𝘀𝗲𝘀𝘀𝗲𝗺𝗲𝗻𝘁 𝘆𝗲𝗮𝗿𝘀.... "

Appreciate consultants or practicing chartered accountants views on this.