TDS on interest part of EMI Car Loan

May i know that is this provision for the not deduction of TDs on interest paid to Car loan taken from the finalcial institution from abroad applicable?

interest paid to Kotak, whether Kotak Bank is a bank covered under the above mentioned?

Further, whether EMI paid to such bank attracts TDS?

No need to deduct tds on any interest payment to any bank or financials institutions

As per para 6 of Circular 619 dt.04.12.1991, commission taken by the consignee from out of the monies due to the consigner is considered as a constructive payment of commission by the consignor to consignee and therefore tax has to be deducted at source by the consignor. 

Since the consignor will always be a receiver of money from the consignee,the compliance of tds obligation under such circumstances can be made only by debiting the consignor and crediting tds payable and on remmittance of tds recover seperately from the consignor tds remmitted by forwarding the paid challan or on quarterly basis after keying in e-tds return.

This circular will equally apply to tds on interest included in EMI. The details of interest and pricipal portion of each installment of EMI is furnished by the Financier at the time of the first installment itself so that the person availing the loan can ascertain well in advance the interest portion included in each EMI for purposes of remmitting tds.

However, in the case of Hire Purchase Contracts, the CBDT vide its Instruction No.1425 dt. 16.11.1981 has clarified that 194A will not be applicable to EMI in relation to a Hire Purchase Contract for the reasoning that the EMI paid by the Contractor cannot be characterised as interest within the meaning of Section 2(28A) of the Income Tax Act,1961.

Scan of Instruction 1425 dt.16.11.1981 is annexed.

https://www.incometaxindia.gov.in/_layouts/15/dit/Pages/viewer.aspx?path=https://www.incometaxindia.gov.in/communications/circular/910110000000000852.htm&grp=&searchFilter=&k=&IsDlg=0

TDS (Tax Deducted at Source) is not applicable on the interest part of EMI for car loans as per current Indian tax laws. When you take a car loan from banks like Kotak Mahindra Bank, the interest you pay is not subject to TDS. Instead, TDS is typically applicable on fixed deposits, savings accounts, and other interest-earning instruments. For car loans, you simply repay the principal and interest as per the EMI schedule without any TDS deductions. Always consult the latest tax guidelines or a financial advisor for accurate and personalized advice.