No Sec. 194-I TDS on Lease Rental Received by Unit of an IFSC Claiming Deduction u/s 80LA | CBDT
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Notification No. 57 /2023, dated 01-08-2023
The Central Board of Direct Taxes (CBDT) has granted an exemption for the tax deduction at source under section 194-I on lease rent or supplemental lease rent received by a unit operating within an International Financial Services Centre (IFSC). The relaxation from the TDS requirement is only applicable for the lease of a ship subject to the following conditions:
(a) The lessor (unit of IFSC) shall:
(i) furnish a statement-cum-declaration in Form No.1 to the lessee giving details of previous years relevant to the ten consecutive assessment years for which the lessor opts for claiming deduction under section 80LA; and
(ii) such statement-cum-declaration shall be furnished and verified in the manner specified in Form No.1, for each previous year relevant to the ten consecutive assessment years for which the lessor opts for claiming deduction under section 80LA.
(b) The lessee shall:
(i) not deduct tax on payment made or credited to the lessor after the date of receipt of the copy of Form No. 1 from the lessor, and
(ii) also furnish the particulars of all the payments on which tax has not been deducted in the TDS statement.
It is to be noted that the above relaxation shall be available to the lessor only during the previous years relevant to the ten consecutive assessment years as declared by the lessor in Form No. 1 for which deduction under section 80LA is being opted. The lessee shall be liable to deduct tax on payment of lease rent for any other year.
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