17 December 2009
A Company has paid Deposit for taking a land on rent.The Company could no longer pay the rent and so it had to vacate the land and the landlord subsequently seized part of the deposit for arrears of rent and part advance rent for 6 months as per the penalty clause of the agreement . Will the Company get a deduction for Rent in arrears and advance as the former has not deducted TDS on the deposit?
17 December 2009
It will be disallowed unless the TDS is deposited on a grossed up basis. The date of adjustment of the deposit (first default of rent payment) will be taken as date of crediting the landlord's account.
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