MAZAGON DOCK SHIPBUILDERS LIMITED

(A Govt. of India Enterprise)

Corporate Identity Number: L35100MH1934GOI002079
Registered and Corporate Office: Dockyard Road, Mumbai - 400010, Maharashtra, India
Phone: 23762012, E-mail: investor@mazdock.com Website: www.mazagondock.in

As you may be aware, as per the Income-tax Act, 1961 (Act), as amended by the Finance Act, 2020,
dividends paid or distributed by the Company after 1st April 2020, shall be taxable in the hands of the
shareholders and the Company shall be required to deduct tax at source (TDS) at the prescribed rates from
the dividend to be paid to shareholders. The TDS rate would vary depending on the residential status of the
shareholder, documents submitted by them and accepted by the Company. Accordingly, the Interim
Dividend will be paid after deducting TDS as explained here under:

I. FOR RESIDENT SHAREHOLDERS

Category of
Exemption applicability/Documentation requirement
shareholders
No TDS is required to be deducted where a self declaration (as per
format available on link https://einward.alankit.com/Docs/7-
Declaration%20for%20Mutual%20Fund%20Companies.pdf) that it
Mutual Funds
is governed by provisions of Section 10(23D) of the Act is provided
along with a self-attested copy of a valid SEBI registration certificate.

No TDS is required to be deducted where a self declaration (as per

format available on link https://einward.alankit.com/Docs/8-
Insurance Declaration%20for%20Insurance%20Companies.pdf) that it has full
Companies beneficial interest with respect to the Ordinary Shares owned by it is
provided along with self-attested copy of valid IRDAI
registration certificate.
No TDS is required to be deducted where a self declaration (as per
format available on link https://einward.alankit.com/Docs/6-
Declaration%20for%20Alternate%20Investment%20Fund%20Comp
Category I and II
anies.pdf) that its income is exempt under section 10(23FBA) of the
Alternative
Act and they are established as Category I or Category II AIF under the
Investment Fund
SEBI regulations is provided along with self-attested copy of valid
SEBI registration certificate needs to be submitted.

Any other entity Valid self-attested documentary evidence (e.g. relevant copy of
entitled to exemption registration, notification, order, etc.) in support of the entity being
from TDS entitled to TDS exemption needs to be submitted.
Other resident A. TDS is required to be deducted at the rate of 10% under Section 194
shareholder of the Act.

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 B. No TDS is required to be deducted, if aggregate dividend distributed
or likely to be distributed during the financial year to individual
shareholders does not exceed INR 5,000/-.
C. No TDS is required to be deducted on furnishing of valid Form
15G (as per format available on link
https://einward.alankit.com/Docs/1-annexure-1-form-15G.docx
) (for individuals, with no tax liability on total income and income
not exceeding maximum amount which is not chargeable to tax)
or Form 15H (as per format available on link
https://einward.alankit.com/Docs/2-anexure-2-form-15H.docx
) (for individual above the age of 60 years with no tax liability on
total income).
D. TDS is required to be deducted at the rate of 20% under Section
206AA of the Act, if valid PAN of the shareholder is not available.
E. TDS is required to be deducted at the rate prescribed in the lower
tax withholding certificate issued under Section 197 of the Act, if
such valid certificate is provided.

 The Finance Act, 2021, has inter alia inserted the provisions of section 206AB of the Act with effect
from July 1, 2021. The provisions of section 206AB of the Act require the deductor to deduct tax at
higher of the following rates from amount paid/ credited to 'specified person':

i. At twice the rate specified in the relevant provision of the Act; or

ii. At twice the rates or rates in force; or
iii. At the rate of 5%
The 'specified person' means a person who has:
a. not filed return of income for both of the two assessment years relevant to the two previous
years immediately prior to the previous year in which tax is required to be deducted, for which
the time limit of filing return of income under sub-section (1) of section 139 has expired; and

b. subjected to tax deduction/collection at source in aggregate amounting to Rs.50,000 or more

in each of such two immediate previous years.
Note: The non-resident who does not have the permanent establishment is excluded from the scope of a
specified person.
 The Company will be relying on the information verified by the utility available on the Income Tax
website.

II. FOR NON-RESIDENT SHAREHOLDERS

Category of
Exemption applicability/Documentation requirement
shareholders
TDS is required to be deducted at the rate of 20% (plus applicable surcharge and
FPIs and FIIs cess) under Section 196D of the Act.

Any entity
Valid self-attested documentary evidence (e.g. relevant copy of registration,
entitled to
notification, order, etc. by Indian tax authorities) in support of the entity being
exemption from
entitled to exemption from TDS is to be submitted.
TDS
Other non- A. Taxes are required to be withheld in accordance with the provisions of
resident Section 195 of the Income Tax Act, 1961, as per the rates as applicable. As
shareholder per the relevant provisions of the Act, the withholding tax shall be at the rate
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 of 20% (plus applicable surcharge and cess) on the amount
of dividend payable to them.

B. Further, as per Section 90 of the Act the non-resident shareholder has the
option to be governed by the provisions of the Double Tax Avoidance
Treaty as read with relevant clauses of Multilateral instrument (if any)
between India and the country of tax residence of the shareholder, if they are
more beneficial to them. To avail Tax Treaty benefits, the non-resident
shareholders will have to provide the following:

1. Self-attested copy of the PAN allotted by the Indian Income Tax

authorities;

2. Self-attested copy of valid Tax Residency Certificate obtained from

the tax authorities of the country of which the shareholder is a
resident for the period April 2023 to March 2024;

3. Copy of Self-declaration in Form 10F filed on Income Tax portal

online

4. Self-declaration in the attached format (as per format given on link

https://einward.alankit.com/Docs/5-
No%20pe%20declaration%20other%20than%20foreign%20comp
any.docx ) certifying that the non-resident shareholder does not have
Permanent Establishment in India in accordance with the applicable
Tax Treaty and has Beneficial ownership of the shares (for the period
April 2023 to March 2024)

C. TDS is required to be deducted at the rate prescribed in a valid lower tax

withholding certificate issued under Section 195/197 of the Act, if such
certificate is provided.

D. The Company is not obligated to apply the beneficial DTAA rates as read
with relevant clauses of Multilateral instrument (if any) at the time of tax
deduction / withholding on dividend amounts. Application of beneficial
DTAA rate shall depend upon the completeness and satisfactory review by
the Company, of the documents submitted by non- resident shareholders.

Transferring credit to the beneficial owner

In cases where the shareholder is merely a custodian of the shares and, accordingly, not the
beneficial owner of the dividend payable in respect thereof, i.e the dividend is assessable in the
hands of another person, then, in order to transfer the credit of TDS to the beneficial owner of
dividend income, i.e in whose hands the dividend is assessable the shareholder may provide a
declaration prescribed by Rule 37BA of the Income-Tax Rules, 1962. The aforesaid declaration
shall contain (i) name, address, PAN and residential status of the person to whom credit is to be
given; (ii) payment in relation to which credit is to be given; and (iii) the reason for giving credit to
such person.

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 The above declaration must be provided on or before 20.11.2023 (Cut-off date) in order to enable
the Company to determine and apply appropriate TDS. Please note that no application under Rule
37BA would be considered in absence of the aforesaid details.

Attention:

1. For all self-attested documents, Shareholders must mention on the document "certified true copy of
the original". For all documents being uploaded by the Shareholder, the Shareholder undertakes to
send the original document(s) on the request by the Company.

2. In case, the dividend income is assessable to tax in the hands of a person other than the registered
Shareholder as on the Book Closure Date, the registered shareholder is required to furnish a
declaration containing the name, address, PAN of the person to whom TDS credit is to be given and
reasons for giving credit to such person.

3. Above communication on TDS sets out the provisions of law in a summarized manner only and
does not purport to be a complete analysis or listing of all potential tax consequences. Shareholders
should consult with their own tax advisors for the tax provisions that may be applicable to them.

4. It may be further noted that in case the tax on dividend is deducted at a higher rate in absence of
receipt of the aforementioned details/documents, there would still be an option available with the
shareholder to file the return of income and claim an appropriate refund, if eligible. No claim shall
lie against the Company for such taxes deducted.

5. In the event of any income tax demand (including interest, penalty, etc.) arising from any
misrepresentation, inaccuracy or omission of information provided / to be provided by the
Shareholder(s), such Shareholder(s) will be responsible to indemnify the Company and also,
provide the Company with all information / documents and co-operation in any appellate
proceedings.

In case tax on dividend is deducted at a higher rate in the absence of receipt of the aforementioned details
/ documents, shareholders would still have an option of claiming refund of the excess tax deducted at the
time of filing their income tax return by consulting their tax advisors. No claim shall lie against
the Company for such taxes deducted. Shareholders will be able to see the credit of TDS in Form 26AS,
which can be downloaded from their e-filing account at https://incometax.gov.in .

Moreover, all Shareholders are requested to ensure that the above details are completed and/or updated, as
applicable, in their respective demat account(s) maintained with the Depository participant(s); with the
Company, before the record date.
Shareholders are requested to ensure that their bank account details in their respective demat accounts are
updated, to enable the Company to make timely credit of dividend in their bank accounts.

Thanking you,

For MAZAGON DOCK SHIPBUILDERS LIMITED

Vijayalakshmi Kumar
Company Secretary

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