It is proposed to insert a new section 206AB in the Act as a special provision providing for higher rate for TDS for the non-filers of income-tax return. Similarly, it is proposed to insert a section 206CCA in the Act as a special provision for providing for higher rate of TCS for non-filers of income-tax return. Proposed section 206AB of the Act would apply on any sum or income or amount paid, or payable or credited, by a person (herein referred to as deductee) to a specified person.



This section shall not apply where the tax is required to be deducted under sections 192, 192A, 194B, 194BB, 194LBC or 194N of the Act.



The proposed TDS rate in this section is higher of the followings rates –

·        twice the rate specified in the relevant provision of the Act; or

·        twice the rate or rates in force; or

·        the rate of 5%



Specified person” proposes to means a person

1. who has not filed the returns of income for both of the two assessment years relevant to the two previous years which are immediately before the previous year in which tax is required to be deducted or collected, as the case may be.

2. further the time limit for filing tax return under section 139(1) of the Act has expired for both these assessment years.

3. There is another condition that aggregate of TDS and TCS in his case is Rs. 50,000 or more in each of these two previous years.

4. Specified person shall not include a non-resident who does not have a permanent establishment in India.