Circular No. 275

What it does

Sends Commissioners a draft circular based on the Finance (No. 2) Bill, 1980, introduced in Parliament on 18 June 1980, giving the rates for deduction from interest on Government securities in the financial year 1980-81, to be issued at once individually to every Treasury Officer and Sub-Treasury Officer. It follows Circular No. 267 dated 24 April 1980, by which deduction had been continued at the rates in Part III of the First Schedule to the Finance Act, 1979 pending the new Bill.

Why it was issued

The rates for the year could only be settled once the Bill was introduced, and the Board passed the proposed rates down so that Treasury Officers could apply them.

Who it reaches

Treasury Officers and Sub-Treasury Officers paying interest on Government securities
Holders of Government securities suffering deduction in 1980-81
Commissioners issuing the instructions in their charges

The instrument, as the Board published it

The words below are the department’s own, reproduced from its published text. Where the department’s copy carried a publisher’s notes after the instrument, those are not reproduced.

FINANCIAL YEAR 1980-81

Instructions for deduction of tax at source during financial year 1980-81 from interest on securities at the rate specified in Part III of First Schedule to Finance (No. 2) Bill, 1980

1. I am directed to invite a reference to this Department’s Circular No. 267 [F.No. 275/13/80-IT(B)], dated 24-4-1980 [Clarification 2], wherein you were requested to issue instructions for deduction of income-tax at source from "interest on Government securities" at the same rates as were given in Part III of the First Schedule to the Finance Act, 1979.
2. In view of the Finance (No. 2) Bill, 1980 introduced in the Parliament on June 18, 1980, a draft circular on the basis of the proposed provisions contained therein is attached herewith which may please be issued immediately to all the Treasury Officers and Sub-Treasury Officers under your control individually.
Circular : No. 275 [F.No. 275/13/80-IT(B)], dated 16-7-1980.

What to watch

The rates are those proposed in a Bill and are for the financial year 1980-81 alone.
The circular itself carries no figures; they are in the attached draft, which is not part of the text supplied here.
The earlier direction it supersedes had continued the Finance Act, 1979 rates, so payments earlier in the year may have borne a different rate.

Where you meet it

A treasury's deduction from a security interest warrant in 1980-81 where the rate applied has to be traced through the year's circulars.

← Circular No. 276 · Circular No. 274 →

A circular binds the department, not you and not a court. The Board issues a circular to its own officers. An assessee may hold the department to a circular that helps him; the department cannot hold an assessee to one that hurts him, and the Tribunal and the courts decide the law for themselves.

Source: the Income Tax Department’s own published text — its page for this instrument.