As per new provision of tax deduction at source (TDS) under the Income Tax Act 1961 effective from April 1, 2010, TDS at higher of the prescribed rate or 20% will be deducted on all transactions liable to TDS, where the Permanent Account Number (PAN) of the deductee is not available.
For more details on the article from Income Tax India, kindly refer the following link:
http://incometaxindia.gov.in/archive/CBDT_PressRelease_01252010.pdf