In a circular issued on March 10, the exchange said the move follows the Income Tax department’s guidelines, which identified instances where excess STT collected by some market intermediaries was not remitted to the government account.
STT is a tax levied on transactions executed on recognized stock exchanges and collected by brokers at the time of trading before depositing with the government.
According to the circular, the Joint Commissioner of Income Tax, Range 7(1), wrote to the exchange on March 5, drawing attention to the issue and seeking clarification from members who may have withheld additional STT.
Following the guidelines, NSE has asked all members to submit additional STT details collected and maintained with them for FY24 and previous years. These details should be submitted directly to the exchange.
The Exchange has also directed the brokers to deposit additional STT with interest calculated at 1% for each month of delay. The funds should be paid to the NSE immediately, after which the exchange will deposit the amount into the government account.
Members are requested to follow the instructions within seven days from the issue of the circular.Also Read | Everyone is selling IT stocks after the record crash, but this Rs 1.3 lakh crore mutual fund is doing the exact opposite
The communication is a continuation of an earlier circular issued on March 19, 2025, which dealt with additional STT retained by members for FY23 and earlier years.
STT forms an important part of the tax framework governing equity and derivatives trading in India. This product applies to a range of market transactions including equity delivery trades, intraday equity trades and derivative contracts.
While brokers are responsible for collecting taxes from investors when executing trades, they are required to remit the money to the government through the exchange system. Any delay or discrepancy in payments may attract penalties or interest obligations under tax regulations.
NSE said members seeking clarification on the circular can contact its finance department.
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