No.17/36/2002-CL.V
GOVERNMENT
OF INDIA
MINISTRY
OF FINANCE AND COMPANY AFFAIRS
DEPARTMENT
OF COMPANY AFFFAIRS
5th
Floor, ‘A’ Wing, Shastri Bhawan,
New
Delhi – 110 001.
Dated 5th July, 2002.
To
All Chambers of Commerce & Industry
(As per standard list)
Subject:- Dividend Warrant-containing
information on
TDS.
Sir,
Section 205(3) of the Companies Act, 1956 provides for payment of
dividend except in cash and Section 205(5)(b) of the Act further provides that
the dividend payable in cash may be paid either by cheque or warrant.
2. Subsequent
to the amendment to Section 10(33) of the Income-tax Act, dividend would be
taxable in the hands of the recipient in respect of dividend income and this
would in the opinion of the Department of Revenue, involve huge amount of paper
work as persons responsible for paying the income would be required to deduct
tax at source from the amount of dividend paid and issue of TDS
certificate. The Department of
Revenue in order to reduce the additional paper work involved in the above
method had suggested that the dividend warrant or intimation sent to the
shareholders by companies may be modified to contain the TDS
also.
3.
Accordingly, in consultation with the Department of Revenue, it is
hereby, clarified that henceforth, companies may adopt a format for dividend
warrants to include information on TDS as under:-
|
Ledger Folio |
No.
of Equity Shares |
Warrant
No. |
Gross
Dividend (Rs.) |
Rate
of Tax |
Tax
Deducted
(Rs.) |
Net Amount
Payable (Rs.) |
|
|
|
|
|
|
|
|
Certified
that a sum of Rs. (in words)……………………………………………………….has been deducted at source
and paid to the credit of the Central Government.
Place………………….
Date……………..
Signature
of person responsible for deduction of tax
Full
Name…………………………………………………
Designation………………………………………………
4. The above
format of TDS may be printed on the reverse side of the warrant duly signed by
persons responsible for deduction of tax.
5. You are
requested to kindly bring to the notice of your constituents about the circular
and request them to adopt the same.
Wherever demat and transfer of dividend by electronic mode is used, the
companies may, however, issue TDS in the same format.
6. While
dividend is paid by cash or cheque, companies may issue TDS certificate in the
above format alongwith dividend intimation.
Yours
faithfully,
(
E. Selvaraj)
Joint
Director (T)