Amendment of section 2

In section 3 of the Principal Act, (i) the words "with reference to" (ii) for the words "one thousand" the words "Two thousand and five hundred" shall be substituted; (iii) at the end of the section the following proviso shall be added, namely:- Provided further that the rates as may be specified by the State Government from time to time by notification in the official Gazette may apply only to such classes of persons as may be specified in the Schedule. (iv) sub-section (2) and the Explanation below shall be substituted, namely:- (2) The tax payable by any persons or paid at such rate as may be specified or deductible or payable under any provision of this Act shall be deducted at source. Explanation (1):- The tax payable by an employee for any assessment year shall be determined with reference to his gross salary or wages earned during the previous year. Explanation (2):- (a) a person on leave shall be deemed to be continuing in the employments; (b) an employee of the State Government or a corporation owned or controlled by the State Government shall be deemed to be in employment within the State even though he is working for or in a branch outside the State.