Rule 208 — Furnishing of declaration and evidence of claims by specified senior citizen under section 393(1) [Table: Sl. No. 8(iii)]. Made under s.393, s.402, s.156 of the Income-tax Act, 2025.
Rule 208 gives effect to Section 393, Section 402 and Section 156 of the Income-tax Act, 2025. A rule cannot go beyond the section it serves: where the two seem to differ, the section governs.
Sub-rule (1) permits the declaration under section 402(39)(c) read with section 393(1) [Table: Sl. No. 8(iii)] to be furnished by a specified senior citizen to the specified bank in Form No. 125.
Sub-rule (2) requires the specified bank, after giving effect to the deduction allowable under Chapter VIII and the rebate allowable under section 156, to compute the total income of that specified senior citizen for the relevant tax year and to deduct income-tax on that total income on the basis of the rates in force.
Sub-rule (3) provides that effect is to be given to the Chapter VIII deduction on the basis of the evidence furnished by the specified senior citizen during the tax year.
Sub-rule (4) requires the declaration under sub-rule (1) and the evidence for claiming the Chapter VIII deduction under sub-rule (3) to be properly maintained by the specified bank and made available to the Chief Commissioner of Income-tax as and when required.
The scheme for a specified senior citizen relieves him of filing a return by making the bank do the computation instead, and that only works if the bank is given the same material an assessee would put in a return. The rule supplies the mechanics: a declaration in a prescribed form, evidence of the deductions claimed, a computation by the bank that gives effect to Chapter VIII and the section 156 rebate before tax is worked out, and a record the Chief Commissioner can call for. It puts the assessment-like task on the bank without giving the bank any discretion about what to allow.
The order of operations in sub-rule (2) is what makes this workable and is easy to get wrong: the bank gives effect to the Chapter VIII deduction and the section 156 rebate first, arrives at the total income, and only then deducts income-tax on that total income at the rates in force — it does not deduct on gross receipts and adjust later. What the bank may allow is bounded by sub-rule (3): the deduction is given on the evidence the senior citizen furnishes during the tax year, so a claim made without evidence, or after the year, has nothing for the bank to act on. The rule states no rate of its own — tax is deducted on the basis of the rates in force. The declaration and the evidence do not end their life at the bank counter; sub-rule (4) makes the bank keep them and produce them to the Chief Commissioner on demand.
A specified senior citizen furnishes Form No. 125 to his specified bank and, during the tax year, produces evidence of a deduction allowable under Chapter VIII. The bank gives effect to that deduction and to the rebate allowable under section 156, computes his total income for the year and deducts income-tax on that amount at the rates in force. It keeps the Form and the evidence on record for production to the Chief Commissioner of Income-tax if called for.
A specified senior citizen meets this rule at his specified bank, in Form No. 125 and in the evidence he hands over during the year; the tax the bank works out under sub-rule (2) is what appears as deduction against his account.
The specified bank shall, after giving effect to the deduction allowable under Chapter VIII and rebate allowable under section 156, compute the total income of such specified senior citizen for the relevant tax year and deduct income-tax on such total income, on the basis of the rates in force.
The effect to the deduction allowable under Chapter VIII shall be given based on the evidence furnished by the specified senior citizen during the tax year.