TDS & Tax on Interest on Compensation for Motor Accident Claims- Rajasthan HC refers matter to Larger Bench

Satya Narayan Vs H.D.F.C. Irgo General Insurance Company Limited (Rajasthan High Court) The petitioners are claimants of motor accident compensation. Their claim petition was allowed by the Motor Accident Claims Tribunal awarding compensation with interest. At the time of payment of such compensation the insurance company had deducted tax at source on the interest component. The petitioners contend that the interest is not taxable and insurance company ought not to have deducted tax at source thereon. Number of decisions have been brought to our notice by the counsel for the petitioners in sup...