TDS

The TDS will be deduted at the rate of 10% on the total interest paid.

Dear Mahi  Bank  Deducted @ 10%  i.e. 1500/- on Rs.15000/- Interest . but if your income does not  exceed from the limit i.e. Rs.1,60,000/- p.a. inculed with this 15000/- interst income you must submit form No.15G for Non deduction of  TDS.

Dear Mahi,

The act below says that the TDS is to be deducted on such income as credited (highlighted in the law below) to the account of the payee. It does not mention here any threshold limit of 10,000.

The threshold limit of Rs 10,000 is mentioned in the 194(3) in order just not to apply provisions of 194(1). The interpretation of this implies that TDS is applicable only if interest exceeeds Rs10,000.
 There is no inetrpretation that if amount exceeds Rs.10,000 then TDS will be deducted on the amount exceeding the threshold limit.

In other words, if Interpretation is that if Interest is below Rs.10,000 then 194(3) applies and when Interest exceeds Rs.10,000 then 194(1) applies. Both the provisoins are mutually exclusicve and not be mixed up.

I hope I clarified your doubt.

[Interest other than "Interest on securities".

194A. (1) Any person, not being an individual or a Hindu undivided family, who is responsible for paying to a resident any income by way of interest other than income ²[by way of interest on securities], shall, at the time of credit of such income to the account of the payee or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct income-tax thereon at the rates in force :

      ³[Provided that an individual or a Hindu undivided family, whose total sales, gross receipts or turnover from the business or profession carried on by him exceed the monetary limits specified under clause (a) or clause (b) of section 44AB during the financial year immediately preceding the financial year in which such interest is credited or paid, shall be liable to deduct income-tax under this section.]

      ⁴[Explanation.—For the purposes of this section, where any income by way of interest as aforesaid is credited to any account, whether called "Interest payable account" or "Suspense account" or by any other name, in the books of account of the person liable to pay such income, such crediting shall be deemed to be credit of such income to the account of the payee and the provisions of this section shall apply accordingly.]

(2) ⁵[Omitted by the Finance Act, 1992, w.e.f. 1-6-1992.]

(3) The provisions of sub-section (1) shall not apply—

      ⁶[(i) where the amount of such income or, as the case may be, the aggregate of the amounts of such income credited or paid or likely to be credited or paid during the financial year by the person referred to in sub-section (1) to the account of, or to, the payee, ⁷[does not exceed—

             (a) ten thousand rupees, where the payer is a banking company to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution, referred to in section 51 of that Act);

             (b) ten thousand rupees, where the payer is a co-operative society engaged in carrying on the business of banking;

             (c) ten thousand rupees, on any deposit with post office under any scheme framed by the Central Government and notified by it in this behalf; and

             (d) five thousand rupees in any other case]:]