.: February 2025

Subject: Regarding rollout of Grievance Management Solution 1.5 (CRM 1.5 as a step towards CRM2.0) developed by CEPT.

Madam/Sir,

This is regarding rollout of Grievance Management Solution 1.5 (CRM 1.5 as a step towards CRM2.0) developed by CEPT. The rollout of the live solution is planned for 05.03.2025 after which the new portal and mobile interface for queries and complaints would be made accessible to our customers.

2. The following pre-rollout activities are to completed by the Circles for smooth rollout and further implementation of the solution:-

(i) Data sanitization: CEPT vide their communication dated 18.02.2025 has intimated

that Customer Data sanitization is still pending from the Circles. This is a prerequisite for processing of new complaints. Circle wise progress report upto 18.02.2025 is enclosed herewith. It is earnestly requested to complete the task by 21.02.2025 as the number of records to be updated can be completed in the given time. Progress will be reviewed by CS/Tech Division, Postal Directorate on 21.02.2025 through V.C with all Circles.

(ii) End User Training and pan-India User Acceptance Testing (UAT):- On inputs of GM CEPT it was decided that given the nature of the application and its intended use across the post office network, the training and UAT of the Solution may be conducted concurrently across the country. Two circles have already tested the solution and are satisfied with the results. For wider familiarization and testing, the session to facilitate the Master Trainers from each circle will be carried out on 24th February 2025 followed by training and testing across each circle during the period 25th February 2025 till 1st March 2025.

Cable TV services

3. As regards Master Trainers from each circle, WCTC trainers/PTCs/ one PA/System Admin/one IP/ASP from each Region may be identified for training online by CEPT on 24th and 25th Feb. 2025 (2 days). Thereafter, trained officers (Master Trainers) will further impart training to end users till 1st March 2025.

4. CEPT will be requested to provide support during the training and testing period for a strong feedback loop during the period 24 Feb to 1st March 2025. Circles are requested to share the nominations for Master Trainers with CEPT, CS Division and Technology Division by 22nd February 2025.

This issues with the approval of the competent authority and needs to be accorded high priority being a Dashboard item reviewed by HMoC.

Yours sincerely,

0/0 DDG (CS, QA & I)

Dak Bhawan, Sansad Marg

New Delhi-110001

F. No. 275/107/2024-FT(B)

Government of India

Ministry of Finance

Department of Revenue

Central Board of Direct Taxes

North Block, New Delhi

Dated the 20th February, 2025

SUBJECT: INCOME-TAX DEDUCTION FROM SALARIES DURING THE FINANCIAL YEAR 2024-25 UNDER SECTION 192 OF THE INCOME-TAX ACT, 1961.

****

Reference is invited to Circular No. 24/2022 dated 07.12.2022, whereby the rates of deduction of income-tax from the payment of income under the head “Salaries” under section 192 of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’), during the financial year 2022-23, were intimated. The said Circular also explained certain related provisions of the Act and Income-tax Rules, 1962 (hereinafter referred to as ‘the Rules’).

The present Circular contains the amendments made vide the Finance (No.2) Act of 2024, Finance (No.1) Act of 2024 and Finance Act of 2023 in respect of rates of deduction of income-tax from the payment of income under the head “Salaries” under section 192 of the Act. Where no amendments have been made by the above referred Acts. in such cases, the above referred Circular No. 24 of 2022 shall continue to be applicable for I. Y. 2024-25. The relevant Acts, Rules, Forms and Notifications arc available at the website of the Income Tax Department- www.incometaxindia. gov. in.

Amendments made vide the Finance (No. 2) Act of 2024, Finance (No. 1) Act of 2024 and Finance Act of 2023 in respect of rates of deduction of income-tax from the payment of income under the head “Salaries” under Section 192 of the Income-tax Act, 1961, during the financial year 2024-25

1. The term “Salary” has been defined in section 15 of the Act. It has been further explained in section 17. As per the amendment In section 17(1) of the Act vide the Finance Act, 2023. “salary”, infer alia, includes the following:

ix) the contribution made by the Central Government in the previous year, to the Agniveer Corpus Fund account of an individual enrolled in the Agnipath Scheme referred to in section 8OCCH, …”

2. As per the amendment vide the Finance Act, 2023 in Section 17(2) of the Act, “perquisite”, inter alia, includes the following:

(i) The value of rent-free accommodation provided to the employee by his employer [computed in such manner as may be prescribed];

(ii) The value of any accommodation provided to the assessee by his employer at a concessional rate…”

3, As per the amendment vide Finance (No. 2) Act, 2024, the provisions related to Surcharge (under Old Tax Regime) applicable in the case of every individual are as under:

S.No. Total Income Surcharge Rate on the amount of income tax under old tax regime

(a) More than Rs 50 lakhs < Rs 1 Crore (including the income by way of dividend or income under sections 111A or 112 or 112A) 10%

(b) More than Rs 1 Crore <= Rs 2 Crore (including the income by way of dividend or income under sections 111A or 112 or 112A) 15%

(c) More than Rs 2 Crore < Rs 5 Crore (excluding the income by way of dividend or income under sections 111A or 112 or 112A) 25%

(d) More than Rs 5 Crore (excluding the income by way of dividend or income under sections 111A or 112 or 112A) 37%

(e) More than Rs 2 Crore (including the income by way of dividend or income under sections 111A or 112 or 112A), not covered under (c) and (d) above 15%

4. As per the amendment vide Finance (No. 2) Act, 2024 in respect of section 115BAC, the rates of income tax (under New Tax Regime) for the FY 2024-25 (1c. Assessment Year 2025-26) are as under:

S.No. Total Income Rate of tax

1. Up to Rs. 3,00,000 Nil

2. From Rs. 3,00,001 to Rs. 7,00,000 5 per cent

3. From Rs. 7,00,001 to Rs. 10,00,000 10 per cent

4. From Rs. 10,00,001 to Rs. 12,00,000 15 percent

5. From Rs. 12,00,001 to Rs. 15,00,000 20 percent

6. Above Rs. 15,00,000 30 percent

Further, for the purposes of sub-section (1A) of section [1SBAC, the total income of the person shall be computed—

(i) without any exemption or deduction under the provisions of clause (5) or clause (13A) or prescribed under clause (14)(other than those as may he prescribed for this purpose) or clause (17) or clause (32), of section 10 or section I0AA or clause (ii) or clause (iii) of section 16 or clause (b) of section 24 [in respect of the property referred to in sub-section (2) of section 23] or clause (iia) of sub-section (1) of section 32 or section 32AD or section 33AB or section 33ABA or sub-clause (ii) or sub-clause (iia) or sub-clause (iii) of sub-section (1) or sub-section (2AA) of section 35 or section 35AD or section 38CCC or under any of the provisions of Chapter V1-A other than the provisions of sub-section (2) of section 8OCCD or sub-section (2) of section 8OCCH or section 80JJAA.

(ii) without set off of any loss,—

(a) carried forward or depreciation from any earlier assessment year. if such loss or depreciation is attributable to any of the deductions referred to in clause (7):

(b) under the head “Income from house property” with any other head of income;

(iii) by claiming the depreciation, if any, under any provision of section 32. except clause

(iia) of sub-section (1) of the said section, determined in such manner as may be prescribed;

and

(iv) without any exemption or deduction for allowances or perquisite, by whatever name called, provided under any other law for the time being in force.

5. As per the amendment made vide Finance (No. 2) Act, 2024, section 192(2B) is reproduced as under:

“…. (2B) Where an assessee who receives any income chargeable under the head “Salaries” has, in addition, –

(i) any income chargeable under any other head of income (not being a loss under any such head other than the loss under the head “Income from house property”); or

(ii) any tax deducted or collected under the provisions of Part B or Part BB of this Chapter, as the case may be,

for the same financial year, he may send to the person responsible for making the payment referred to in sub-section (1), the particulars of-—

(a) such other income:

(b) any tax deducted or collected under any other provision of Part B or Part BB of this Chapter, as the case may be; and

in such form and verified in such manner as may be prescribed, and thereupon the person responsible us aforesaid shall take into account the particulars referred to in clauses (a). (bd) and (c) for the purposes of making the deduction under sub-section (1):

Provided that this sub-section shall not in any case have the effect of reducing the tax deductible from income under the head “Salaries”, except where the loss under the head “Income from house property” and the tax deducted in accordance with other provisions of Part B and tax collected in accordance with the provisions of Part BB. of this Chapter, has been taken into account.

6. The Form No. 16 has been amended vide the Income-tax (Fifth Amendment) Rules, 2023, w.e.f, 1-7-2023 and shall be applicable for the assessment year 2024-25 and subsequent assessment years, Form No. 16 (has been further modified vide the Income-tax (Eighth Amdt.) Rules, 2024, w.e.f. 15-10-2024. The modified Form No. 16 is placed at Annexure-A.

7. The amendments in Form No. 24Q made by the Income-tax (Fifth Amendment) Rules, 2023 are as under:

(i) In Annexure-I : Deductee wise Break up of TDS, “Health and Education Cess” has been substituted for “Education Cess”’.

(ii) Annexure-II ; Details of salary paid or credited during the financial year…….. and net tax payable (under section 192) has been substituted by the Income-tax (Fifth Amendment) Rules. 2023, w.e.f. 01.07.2023.

Further, the amendment in Form No. 24Q made by the Income-tax (Eighth Amendment) Rules, 2024 w.e.f. 15.10.2024 is as under:

(1) In Annexure-II, column No. 388A- ‘Amount reported as per section 192(2B), of other tax deducted at source or tax collected at source, other than (388)’ has been inserted.

8. As per the amendment vide Income-tax (Eighteenth Amendment) Rules, 2023 w.e.f. 01.09.2023 in the Rule 3 of the Rules, in respect of the accommodation provided by any other employer, the rates prescribed for valuation of perquisites are as under:

S.No. Circumstances Where accommodation is unfurnished Where accommodation is furnished

(i) Where the accommodation is provided by any other employer and.-

(a) where the accommodation is owned by the employer, or (i) 10% of salary in cities having population exceeding 40 lakhs as per 2011 census; The value of perquisite us determined under column (3) and increased by 10% per annum of the cost of furniture (including television sets, radio sets, refrigerators, other household appliances, air-conditioning plant or equipment or other similar appliances or gadgets) or if such furniture is hired from a third party, by the actual hire charges payable for the same as reduced by any charges paid or payable for the same by the employee during the previous year.

(ii) 7.5% of salary in cities having population exceeding 15 lakhs hut not exceeding 40 lakhs as per 2011 census;

(iii) 5% of salary in other areas, in respect of the period during which the said accommodation was occupied by the employee during the previous year as reduced by the rent, if any, actually paid by the employee.

(b) where the accommodation is taken on lease or rent by the employer. Actual amount of lease rental paid or payable by the employer or 10% of salary, whichever is lower, as reduced by the rent. if any, actually paid by the employee. The value of perquisite as determined under column (3) and increased by 10% per annum of the cost of furniture (including television sets. radio sets, refrigerators, other household appliances, air-conditioning plant or equipment or other similar appliances or gadgets) or if such furniture is hired from a third party. by the actual hire charges payable for the same as reduced by any charges paid or payable for the same by the employee during the previous year.

9. The definition of “remote area” given in Explanation (v) to Rule 3 of the Rules has been amended vide Income-tax (Eighteenth Amendment) Rules, 2023 w.e.f. 01.09.2023 as under:

“…(v) “remote area”, for purposes of proviso to sub-rule (1) means any area other than an area which is located

(a) within the local limits of; or

(b) within a distance, measured aerially, of 30 kilometers from the local limits of, any municipality or a cantonment hoard having a population of 1.00,000 or more based on the 2011 census…’

10. As per clause (1) of sub-rule (7) of Rule 3, the value of free food and non-alcoholic beverages provided by the employer to the employee shail be the amount of expenditure incurred by such employer. As per the amendment vide Income-tax (Tenth Amendment) Rules, 2023, w.e.f, 21.06.2023, the second proviso to clause (iii) of sub-rule (7) of Rule 3 reads as under-

“Provided further that the provisions of the first proviso in respect of free food and non-alcoholic beverage provided by the employer through paid voucher shall not apply to an employee, being an assessee, who has exercised an option under sub-section (3) of section 115BAC or whose income is chargeable to tax under sub-section (1A) of section 115BAC.”

11. The exemption limit of leave encashment, In the case of employees other than Government employees, has been enhanced to Rs 25,00,000/- vide CBDT Notification No. 31/2023 dated 24.05.2023. Accordingly, the exemption in respect of leave encashment in case of a non-Government employee at the time of retirement shall be lower of the following amounts:

Period of earned leave standing to the credit in the employee’s account at the time of retirement x average monthly salary.

Average monthly salary x 10 (i.e.. 10 months’ average salary).

Maximum amount as specified by the Central Government, ie. Rs.25,00,000.

Leave encashment actually received at the time of retirement.

If an employee receives leave salary from more than one employer in the same year. then the maximum amount of exemption under section 10(10AA)(ii) of the Act cannot exceed the amount specified by the Central Government (i.e., Rs. 25,00,000). Where any employee has claimed exemption of leave salary under this section in any earlier year(s), then in case of such employee, the ceiling lint (.e., Rs. 25,00,000) shall be reduced by the amount of exemption earlier claimed.

12. The sub-section (12C) has been inserted in section 10 of the Act vide Finance Act, 2023. Under section 10(12C) of the Act, any payment from the Agniveer Corpus Fund to a person enrolled under the Agnipath Scheme, or to his nominee shall be exempt. Section 10(12C) of the Act is reproduced as under:

“(12C) any payment from the Agniveer Corpus fund to a person enrolled under the Agnipath Scheme, or to his nominee.

Explanation. For the purposes of this clause “Agniveer Corpus Fund” and “Agnipath Scheme” shall have the meanings respectively assigned to them in section B0CCH,; ”

13. Section 87A provides relief in the form of rebate to individual taxpayers, resident in India, who are in lower income bracket, 1.e. having total income not exceeding Rs 5.00,000/-. The amount of rebate available under section 87A is Rs 12,500/- or the amount of tax payable, whichever ts less. As per the amendment vide Finance Act, 2023, w.e.f. 01.04.2024, the proviso to section 87A has been inserted and the same is reproduced as under:

“.. Provided that where the total income of the assessee is chargeable to tax under sub-section (1A) of section 11SBAC, and the total income—

(a) does not exceed seven hundred thousand rupees, the assessee shall be entitled to a deduction from the amount of income-tax (as computed before allowing for the deductions under this chapter) on his total income with which he is chargeable for any assessment year, of an amount equal to one hundred per cent of such income-tax or an amount of twenty-five thousand rupees, whichever is less;

(b) exceeds seven hundred thousand rupees and the income-tax payable on such total income exceeds the amount by which the total income is in excess of seven hundred thousand rupees, the assessee shall be entitled to a deduction from the amount of income-tax (as computed before allowing the deductions under this Chapter) on his total income, of an amount equal to the amount by which the income-tax payable on such total income is in excess of the amount by which the total income exceeds seven hundred thousand rupees.

14. Section 80CCH of the Act related to ‘Deduction in respect of contribution to Agnipath Scheme’ has been inserted vide Finance Act, 2023. Accordingly after paragraph No. 11 of para 5.5.3 the following paragraph No. 12 1s inserted and the same is to be read as under:

“8OCCH. (1) Where an assessee, being an individual enrolled — in the Agnipath Scheme and subscribing to the Agniveer Corpus fund on or after the 1st day of November, 2022. has in the previous year paid or deposited any amount in his account in the said Fund, he shatl be allowed u deduction in the computation of his total income, of the whole of the amount so paid or deposited.

(2) Where the Central Government makes any contribution to the account of an assessee in the Agniveer Corpus Fund referred to in sub-section (]), the assessee shall be allowed u deduction in the computation of his total income of the whole of the amount so contributed.

Explanation.— For the purposes of this section, —

(a) “Agnipath Scheme” means the scheme for enrolment in Indian Armed Forces introduced vide letter No. 1(23)2022/D(Pay/Services), dated the 29th December, 2022 of the Government of India in the Ministry of Defence:

(b) “Agniveer Corpus Fund” means a fund in which consolidated contributions of all the Agniveers and matching contributions of the Central Government along with interest on both these contributions are held.”

15. Amendments in Penalty and Prosecution provisions on default on account of TDS-

(i) As per the Finance Act, 2023, section 271C on ‘Penalty for failure to deduct tax at source’ has been amended. Section 271C, inter alia, lays down that if any person fails to deduct whole or any part of tax al source or fails to pay or ensure payment of, the whole or any part of tax under the proviso to section 194B (w.e.f. 01.04.2023), sub-section (2) of section 194BA (w.e.f, 01.07.2023), he/she shall be liable to pay, by way of penalty, a sum equal to the amount of tax not deducted or paid or payment ensured by him.

(ii) As per the Finance Act, 2023, section 276B on ‘Failure to pay tax to the credit of Central Government under Chapter XII-D or XVII-B’ has been amended. Section 276B lays down that if a person fails to pay to the credit of the Central Government within the prescribed time, as above, the tax deducted al source by him or tax payable by him or ensure payment of tax under the proviso to Section 194B (w.e.f. 01.04.2023), or section 194BA(2) (w.e.f. 01.07.2023), he/she shall be punishable with rigorous imprisonment for a term which shall not be less than three months but which may extend to seven years and with fine.”

(iii) Further. the following proviso has been inserted in section 276B of the Act vide Finance (No.2) Act, 2024:

“Provided that the provisions of this section shall not apply if the payment referred to in clause (a) has been made to the credit of the Central Government at any finite on or before the time prescribed for filing the statement for such payment under sub-section (3) of section 200. ”

16. Miscellaneous

16.1 These instructions are not exhaustive and are issued only with a view to guide the employers. Wherever there is any doubt, reference may be made to the provisions of the Income-tax Act, 1961, the Income-tax Rules, 1962, the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2022 (No. 38 of 2022), the above mentioned Finance Acts, the relevant circulars / notifications, etc.

16.2 It is stated that in case any assistance is required, the Assessing Officer/the Local Public Relation Officer of the Income-tax Department may be contacted.

16.3 These instructions may be brought to the notice of all Disbursing Officers and Undertakings including those under the control of the Central/ State Governments.

16.4 Copies of this Circular are available at the following websites: www.finmin.nic.in & www.incometaxindia.gov.in

Hindi version will follow.

(Rubal Singh)

Deputy Secretary

(IT-Budget), CBDT

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