Disallowance of salary expenses

This query is : Resolved

RAVI SONI (Querist)
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25 January 2013 If a company assessee at the time of payment of salary to its employee has done the following errors :-

1. Not deducted TDS
2. Short deduction of TDS
3. TDS deducted but not deposited to Govt A/C

In these cases I want to know whether the A.O has the power to disallow the salary expenses, and if he can disallow such expenses then under which section salary expenses can be disallowed.

PLEASE ADVICE.

Anand

Anand (Expert)
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25 January 2013 No, in my view AO cannot disallow the salary amount unless it is payable outside India or to a non-resident u/s 40(a)(iii)