The constitutional validity of section 194N
Now constitutional validity of section 194 N is challenged. Under this section, the government is deducting TDS on the withdrawal of cash from a bank account.
PIL has already been filed in various courts. Let’s wait what stand court will take on this matter. Some experts feel that this provision violates article 265 of the constitution. This article provides that No tax shall be levied or collected except with the authority of law. A mere transaction of withdrawal funds doesn’t give the authority to levy the income tax on such transactions. Income tax can not be treated as a mere transaction tax.
Although there can be an argument that TDS can be claimed as a refund. But there is not a question of whether we can claim a refund or not. The question is, whether TDS can be deducted on a transaction that does not fall under the category of ‘Source Of Income’. Do you really think that.. withdrawal from bank our own money will become the source of income for deducting TDS on it?
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