What is withholding taxes charged on room revenue

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Why is witholding tax being charged to individuals below INR 500,000 income? The law specifically states the exclusion of such individuals provided PAN card is provided. I am attaching the screenshot of the law which states this.  I have written to Finance regarding this but they do not reply. Instead i get automated replies that are vague. is anyone facing this issue?

Hello,

I would also advise to check with your tax accountant or lawyer for local laws! 

Cheers.