04 May 2011
I want to know , when Mr.XYZ a NRI has earned capital gain on sale of his shops to Mr.ABC an Indian individual and where said Mr. ABC is not eligible for his Tax Audit under provision of section 44AB of Income Tax Act, 1961 , in such case whether is it mandatory for this purpose Mr. ABC to obtain TAN compulsory in his own name and deduct tax at source of the said NRI on capital gain amount OR no need for deduction of tax by Mr. ABC and let Mr. XYZ, the NRI pay himself tax on the said capital gain amount ? Please assist me in this matter and also let me know which other provision of Income Tax Act,1961 or any decided case relating to this case shall I refer with.
05 May 2011
The ultimate responsibility of deduction of TDS shall be on ABC and hence ABC should ensure that ABC deposits the tax directly on behalf of XYZ (from the money payable to XYZ).
Then ABC shall not be required to obtain TAN and file TDS return.
CAclubindia
