Repairing & Maintainance Expenses - TDS

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

28 May 2010 A Company paid Rs. 31108 and 17869 /- as repairing & maintainance expenses to its plant & machinery .WEATHER IT TDS IS TO BE DEDUCTED OR NOT.U/S194COR OTHER SECTION.

Aditya Maheshwari

Aditya Maheshwari (Expert)
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28 May 2010 TDS deductible on Rs. 31,108/- u/s 194C as a single bill exceeds Rs. 20,000/-

Querist : Anonymous

Querist : Anonymous (Querist)

28 May 2010 but why repairing & maintainance expenses included in contract that is section 194C.?

what if TDS is not deducted.?
weather it is disallowed.?
disallowed amt is what 31108 or both?

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Aditya Maheshwari

Aditya Maheshwari (Expert)
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28 May 2010 Section reads as Any person responsible for paying any sum to any resident (hereafter in this section referred to as the contractor) for carrying out any work.

So repairs is a work carried out. Hence TDS deductible.

IF TDS not deducted then expenses disallowable u/s 40(a)(ia).

For amount of disallowance the section reads as
(5) No deduction shall be made from the amount of any sum credited or paid or likely to be credited or paid to the account of, or to, the contractor, if such sum does not exceed twenty thousand rupees :
Provided that where the aggregate of the amounts of such sums credited or paid or likely to be credited or paid during the financial year exceeds fifty thousand rupees, the person responsible for paying such sums referred to in sub-section (1) shall be liable to deduct income-tax under this section.

So going by literal interpretation only Rs. 31,108/- should be disallowed. If the person who carried out the R & M can split the bill in two parts then no TDS deductible.

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