NOCIL Limited has issued a comprehensive communication to shareholders regarding tax deduction at source (TDS) procedures for its recommended dividend for the financial year ended 31st March 2026.

The Board of Directors recommended a dividend of Rs 1.50 per equity share of Rs 10 each at their meeting held on 7th May 2026. This dividend is subject to approval by members at the 64th Annual General Meeting convened on 3rd August 2026. If approved, the dividend will be paid on or after 10th August 2026 to members whose names appear on the Company's Register of Members as on 24th July 2026.

Pursuant to the Finance Act, 2020, dividend income is taxable in the hands of shareholders, requiring the Company to deduct TDS under sections 194/195/196D of the Income Tax Act, 1961. The deducted tax will be paid to the credit of the Central Government.

TDS Rates and Documentation Requirements

The communication provides detailed TDS rates and documentation requirements for different categories of shareholders:

Resident Shareholders (Table 1):

  • General resident shareholders: 10% TDS rate
  • Exemptions apply if dividend income does not exceed ₹10,000 during Tax Year 2026-27 for resident individuals
  • Insurance companies, mutual funds, AIFs, NPS Trust: NIL TDS with specific declarations
  • Shareholders without PAN or invalid PAN: 20% TDS rate

Non-Resident Shareholders (Table 2):

  • General rate: 20% plus applicable surcharge and cess
  • Lower Tax Treaty rates available upon submission of required documents including:
  • PAN card copy (if allotted)
  • Valid Tax Residency Certificate
  • Electronically filed Form 41
  • Various self-declarations regarding permanent establishment, Principal Purpose Test, and beneficial ownership

Key Deadlines and Procedures

  • Documents must be uploaded with KFin Technologies Limited at https://ris.kfintech.com/form15 or emailed to einward.ris@kfintech.com
  • No communication on tax determination/deduction will be considered after 20th July 2026
  • Dividend will be paid ONLY by electronic mode to members who have updated their bank account details
  • No demand drafts/pay orders will be issued

Important Notes

  • TDS certificate will be issued in Form 131
  • Credit for TDS can be verified through Form 168 (Annual Information Statement)
  • If aggregate dividend payout exceeds ₹10,000 during the tax year, tax will be deducted on current and earlier dividend amounts
  • PAN is mandatory, and failure to link Aadhaar with PAN will make PAN inoperative, triggering 20% TDS
  • Non-quoting of PAN attracts penalty of ₹10,000 under section 467 of the Act
  • Shareholders holding physical shares must submit PAN to Company/RTA
  • The Company supports the "Saksham Niveshak" campaign (April 1-July 9, 2026) to help shareholders claim unpaid/unclaimed dividends