Tds applicability (if no tax audit aapplicable)

This query is : Resolved

Anwar Shaikh (Querist)
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23 January 2014 Dear Experts,

If a private limited company has zero sales, zero purchase, zero transaction in last three financial years.

And this year it purchased a land (Fixed asset)and paid commission to agent of Rs.15,00,000/-. (This year also no trading sales/purchase)

1) Does TDS is applicable in this case.

(Tax audit not applicable)

2) Can this commission may form part of Land price ? and add to cost of Land ?

3) If so, then can still TDS is applicable, as no expenses is debited to P&L, hence there will be disallowance ?

CA Prashant Gupta

CA Prashant Gupta (Expert)
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23 January 2014 1) TDS is applicable in this case even tax audit is not applicable. TDS liability is still arise on company even tax audit is not applicable.

2) Yes, Commission on purchase of fixed assets should be include in cost of asset.

3) If TDS is not deducted then It will be added in income, not disallowed as expenditure.