Amended and updated notes on section 206CC of Income Tax Act 1961 as amended by the Finance Act 2022 and Income-tax Rules, 1962. Detail discussion on provisions and rules related to Requirement to furnish Permanent Account number by collectee.
Chapter XVII (Sections 190 to 234G) of the Income Tax Act 1961 deals with the provisions related to collection and recovery of tax. Section 206CC of IT Act 1961 provides for Requirement to furnish Permanent Account number by collectee.
Recently, we have discussed in detail section 206CB (Processing of statements of tax collected at source) of IT Act 1961. Today, we learn the provisions of section 206CC of Income-tax Act 1961. The amended provision of section 206CC is effective for financial year 2022-23 relevant to the assessment year 2023-24.
In this article, you will learn detail of the provisions of section 206CC of the Income Tax Act, 1961 Bare Act read with the Income-tax Rules, 1962 as provided by Ministry of Law and Justice, Government of India.
Section-206CC: Requirement to furnish Permanent Account number by collectee
Section 206CC(1) of Income Tax Act
Notwithstanding anything contained in any other provisions of this Act, any person paying any sum or amount, on which tax is collectible at source under Chapter XVII-BB (herein referred to as collectee) shall furnish his Permanent Account Number to the person responsible for collecting such tax (herein referred to as collector), failing which tax shall be collected at the higher of the following rates, namely:—
- (i) at twice the rate specified in the relevant provision of this Act; or
- (ii) at the rate of five per cent.
Section 206CC(2) of Income Tax Act
No declaration under sub-section (1A) of section 206C shall be valid unless the person furnishes his Permanent Account Number in such declaration.
Section 206CC(3) of Income Tax Act
In case any declaration becomes invalid under sub-section (2), the collector shall collect the tax at source in accordance with the provisions of sub-section (1).
Section 206CC(4) of Income Tax Act
No certificate under sub-section (9) of section 206C shall be granted unless the application made under that section contains the Permanent Account Number of the applicant.
Section 206CC(5) of Income Tax Act
The collectee shall furnish his Permanent Account Number to the collector and both shall indicate the same in all the correspondence, bills, vouchers and other documents which are sent to each other.
Section 206CC(6) of Income Tax Act
Where the Permanent Account Number provided to the collector is invalid or does not belong to the collectee, it shall be deemed that the collectee has not furnished his Permanent Account Number to the collector and the provisions of sub-section (1) shall apply accordingly.
Section 206CC(7) of Income Tax Act
The provisions of this section shall not apply to a non-resident who does not have permanent establishment in India.
Explanation: For the purposes of this sub-section, the expression “permanent establishment” includes a fixed place of business through which the business of the enterprise is wholly or partly carried on.