499 : Circular No. 499, dated 01-12-1987

FINANCIAL YEAR 1987-88

 Instructions for deduction of tax at source from salary during financial year 1987-88 at the rates specified in Part III of First Schedule to Finance Act, 1987

1. I am directed to refer to this Ministry’s Circular No. 489 [F.No. 275/51/87-IT(B)], dated 25-6-1987 [Clarification 1] wherein the rates of income-tax deduction during the year 1987-88 from the payment of income chargeable under the head ‘Salaries’ under section 192 were intimated.

2. The Central Government has promulgated an Ordinance (No. 6 of 1987) on 19-9-1987. By this Ordinance, Part III of the First Schedule to the Finance Act, 1987 has been amended. Accordingly, where the income of a person chargeable to tax under the head "Salaries" exceeds Rs. 50,000, the amount of income-tax computed for the purpose of deduction of tax at source shall be increased by a surcharge for the purpose of the Union calculated at the rate of 5 per cent on the amount of income-tax so computed. An illustration is given in Annex I. These instructions may be brought to the notice of all Drawing and Disbursing Officers and State Undertakings under the control of the State Governments.

Circular: No. 499 [F.No. 275/51/87-IT(B)], dated 1-12-1987.