Draft Income Tax Rule 219: Statement of deduction or collection of tax at source under Section 397(3)(b)
Rule 219 of the Draft Income-tax Rules, 2026 prescribes the manner, forms, and timelines for furnishing statements of tax deducted or collected at source under section 397(3)(b). Every deductor or collector under Chapter XVII-B must file quarterly statements in specified forms depending on the nature of deduction and status of the deductee—Form 138 for salary and specified cases, Form 144 for certain payments to non-residents or not ordinarily residents, Form 140 for other specified deductions, and Form 143 for tax collected at source. Exchanges paying tax on virtual digital asset (VDA) transactions under section 400(2) must file quarterly statements in Form 142, including details of transactions where tax was not deducted. Quarterly statements are due by 31 July, 31 October, 31 January, and 31 May for the respective quarters. For specified payments such as rent, immovable property transfers, contractual/professional payments, and VDAs, a challan-cum-statement in Form 141 must be furnished within thirty days from month-end. Refund claims for excess sums paid must be made in Form 139. Trustees of approved superannuation funds must also submit annual statements with prescribed particulars and verification. The rule ensures structured, timely, and comprehensive TDS/TCS reporting, including digital asset transactions.
Extract of Rule No. 219 of Draft Income-tax Rules, 2026
Rule 219
Statement of deduction or collection of tax at source under Section 397(3)(b) of the Act.
(1) Every person responsible for deduction of tax or collection of tax at source under Chapter XVII-B with respect to the sections referred in Column (B) of the Table below, shall, as per section 397(3)(b), deliver, or cause to be delivered, to the Director General of Income-tax (Systems) or the person authorised by him, the quarterly statements in Form as referred to in Column (C) thereof:
TABLE
| Sl. No. |
Section under which tax deducted, paid or collected | Form |
| (A) | (B) | (C) |
| 1 | Section 392 [other than section 392(7)] and section 393(1) [Table: Sl. No. 8(iii)] | 138 |
| 2 | Section 392(7), 393(2) and 393(3) in respect of the deductee who is a non-resident not being a company or a foreign company or resident but not ordinarily resident | 144 |
| 3 | Section 392(7), Section 393(1) (other than [Table: Sl. No. 8(iii)]) and 393(3) in respect of the deductee other than the deductee referred to in sr. no. 2 above | 140 |
| 4 | Section 394(1) | 143 |
(2) Where under the guidelines issued under section 400(2) of the Act read with section 393(1) [Table: Sl. No. (8)(vi)] of the Act, the exchange has agreed to pay tax in relation to a transaction of transfer of a virtual digital asset, owned by it as an alternative to tax required to be deducted by the buyer of such asset under section 393(1) [Table: Sl. No.(8)(vi)], the exchange shall deliver or cause to be delivered, a quarterly statement of such transactions in Form No. 142.
(3) The exchange referred to in sub-rule (2) shall, at the time of preparing the quarterly statement in Form No. 142 furnish particulars of amount paid or credited on which tax was not deducted in accordance with guidelines issued under section 400(2).
(4) Statements referred to in sub-rules (1) and (2) for the quarter of the financial year ending with the date specified in column (B) of the Table below shall be furnished by the due date specified in the corresponding entry in column (C) thereof:
TABLE
| Sl. No. | Date of ending of quarter of financial year | Due date |
| (A) | (B) | (C) |
| 1. | 30th June | 31st July of the financial year |
| 2. | 30th September | 31st October of the financial year |
| 3. | 31st December | 31st January of the financial year |
| 4. | 31st March | 31st May of the financial year immediately following the tax year in which the deduction is required to be made. |
(5) Irrespective of anything contained in sub-rule (1) or (2) or (4), a challan-cum-statement in Form No. 141 shall be furnished within thirty days from the end of the month in which the deduction is made by the person responsible for deduction of tax under the following section, namely:–
(a) section 393(1) [Table Sl. No. (2)(i)];
(b) section 393(1) [Table Sl. No. (3)(i)];
(c) section 393(1) [Table Sl. No. (6)(ii)];
(d) section 393(1) [Table Sl. No. (8)(vi)];
(6) A claim for refund, for sum paid to the credit of the Central Government under, Chapter XIX-B shall be furnished by the deductor in Form No. 139.
(7) In cases where the trustees of an approved superannuation fund pay any contributions made by an employer, including interest on such contributions, to an employee during his life-time, they shall send within two months from the end of the financial year to the Director General of Income-tax (Systems) or the person authorised by him, a statement giving the following particulars, namely :—
(i) name of the superannuation fund;
(ii) name and address of the employee;
(iii) the period for which the employee has contributed to the superannuation fund;
(iv) the amount of contribution repaid on account of principal and interest;
(v) the average rate of deduction of tax during the preceding three years; and
(vi) the amount of tax deducted on repayment.
(8) A duly-signed verification in the following Form shall be annexed to the statement referred to in sub-rule (7):
FORM OF VERIFICATION
We/I, the trustee(s) of the above named fund, do declare that what is stated in the above statement is true to the best of our/my information and belief.
(9) For the purposes of sub-rule (2),—
(a) “Exchange” means a person that operates an application or platform for transfer of virtual digital assets, which matches buy and sell trades and execute the same on their application or platform;
(b) “virtual digital asset” shall have same meaning as assigned to it in Section 2(111) of the Act.
