13 January 2008
i am discounting my bill of Rs. 50,00,000/- thru a private party mr.A and he is deducting Rs.50,000/- as a bill discounting and send me a Cheque of Rs. 49,50,000/- should i require to deduct tax u/s. 194A on rs. 50,000/- whether it covers under definition of Interest ? so, my query is wheter i should deduct tax on charged debited to my profit and loss account under the head of 'bill discount'. in recent judgement of of Kanha Vanaspati Ltd..v.Additional Commissioner of Income-tax, Range-50, New Delhi, kindly clarify considering this judgement. the main problem is how can i deduct tax as i am not directly paying anything in form of bill discounting as the financer cut the same charges and then after giving me a remaining payment
27 February 2008
The bill discounting has done been done thru banks. The charges deducted is nothing but the commission. As such the TDS should be deducted.
Guest
Guest
(Expert)
16 January 2011
No, charges so deducted is not the commission but it can be treated as interest.
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