The provisions of TDS require a person ( Tax Deductor ), on whom responsibility has been cast, to deduct tax at the appropriate rate(s) from specified types and categories of payments of income made to a person (recipient of income). As the deducted sum forms part of the Revenue, the same in required to be deposited to the credit of Central Government in the prescribed mode and manner and within the prescribed time limit.
Generally speaking, person responsible for paying any amount, subjected to TDS, is the person required to deduct tax at source. Such persons are:
a) In the case of private or non-Government employment, it is the employer and if the employer happens to be a company, it is the company itself including its Principal Officer;
b) In the case of Government employment, it is the payer himself, being the respective Drawing and Disbursing Officer (DDO) designated as such by the Government;
c) In the case of “interest on securities” other than payments made by or on behalf of the Central Government or the Government of a State, it is the local authority, corporation or company, including the principal officer thereof;
d) In the case of any other type of credit or payment, it is the payer himself. If the payer happens to be a company, it is the company including its principal officer, who is also responsible for such deduction;
e) An individual or HUF will be required to deduct tax at source from payments made under Sec. 194A, 194C, 194H, 194I and 194J, if the total sales or gross receipts or turnover from business or profession carried on by such individual or HUF during the financial year, immediately preceding the financial year in which any such payment is credited or paid, exceed the monetary limit specified under clause (a) or clause (b) of Sec. 44AB (presently, business- Rs. 60 lakhs and profession – Rs. 15 lakhs).
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