P@R@G (Accounts Head & Final CA & CS) (79 Points)
02 July 2011
Whether Payer of Income is liable to pay the amount of short/non-deduction of Tax if Payee has already paid tax on relevant income? S. 201(1)
Example:- Mr.x paid Rs.1,00,000/- to Mr.B TDS suppose to be deduct Rs.10,000/-(10%) but actually deducted Rs.2,000/-(2%) short dedication Rs.8,000/-
can i have claim full expenses u/s 40a ?
KIYOSH
(TAX CONSULTANT)
(332 Points)
Replied 02 July 2011
I think No.
But you can deposit TDS, related to any month of previous year by due date for Income return Filing date and can claim expense in previous year.And this provision is proposed to be applicable from financial year 2009-10.
KIYOSH
C.A SHASHANK GOYAL
(Chartered Accountant)
(362 Points)
Replied 02 July 2011
Hi, for non - deduction of TDS you will be deemed to be the assessee in default u/s 220 and also penalty equal to amount of TDS will be levied u/s 271C which shall be imposed by joint commissioner .
Point regarding admissibilty of expense if tax has not been deducted in accordance with the provisions of chapter XVII-B such expenses shall be disallowed by virtue of provision of section 40(a)ia).
I did not have clear idea about short deduction but such expense in my opinion , entire expenses shall be disallowed since TDS has not been deducted in accordance with the provisions of that chapter .
Anjaly.P.A
( Article( CA Final))
(221 Points)
Replied 02 July 2011
There are 2 views,
One is Allow the propotionate expense
& the other is allow the whole expense, it will attract interest.
CAclubindia
