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Section 40a

Prince (Manager Accounts) (36 Points)

06 August 2011

Hello Friends,

Section 40a of I.T Act 1961,inter alia provides that if TDS is not dducted on any Payment made then such expenditure will be disallowed and can only be subsequently claimed in that F/Y in which TDS is deducted and deposited.

My querry is that suppose in F/y 2009-10 a person made a payment of Rs100000 for professional services on which TDS of Rs.10000 was to be deducted but the assesse forgot to do so and made full payment of Rs.100000/-

In F/Y 2010-11, if the assesse want to deduct TDS to claim the expense then how he can do so? whether he need to file revised return for the 2009-10 or he can show that the TDS is deducted in current year only ??

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7 Replies

Sidhardh (Sr. Manager - Accounts) (178 Points)
Replied 06 August 2011

Deduct TDS and pay along with interest in FY 2010-11. You should file revised return for concened quarter of FY 2009-10 since the TDS belongs to previous financial year and TDS payment challan also will refer the payment as FY 2009-10.

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Sidhardh (Sr. Manager - Accounts) (178 Points)
Replied 06 August 2011

If you pay the amount now, then it will be treated as that you paid the TDS amount in FY 2011-12 and deduction of expenses will be allowed only in FY 2011-12 P&L Statement.

Prince (Manager Accounts) (36 Points)
Replied 06 August 2011

Originally posted by : Sidhardh
	If you pay the amount now, then it will be treated as that you paid the TDS amount in FY 2011-12 and deduction of expenses will be allowed only in FY 2011-12 P&L Statement.

I agree to your advice that he can file revised return .But now considering the second aspect from the point of deductee... deductee is a corporate and has filed the I.T return for the previous year and also assesment u/s 143(3) is been done.

Now the deductee neither can revise the return u/s 139(5), so how he can claim refund of the TDS amount reflecting in its 26 AS in P/Y 2009-10??

Prince (Manager Accounts) (36 Points)
Replied 06 August 2011

As per my knowledge we can seek for relief u/s 154 of the I.T Act but it seems a quite common section which advocates also know.

I am looking for some relevant section of I.T Act under which i can seek for relief.

Prince (Manager Accounts) (36 Points)
Replied 06 August 2011

As per my knowledge we can seek for relief u/s 154 of the I.T Act but it seems a quite common section which advocates also know.

I am looking for some relevant section of I.T Act under which i can seek for relief.

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CA R K SINGH (CA CS FINAL CMA INTER) (372 Points)
Replied 06 August 2011

Hi prince,

file tds return mentioning that amount paid 0 in the current year . In Tax deducted enter the TDS amount .

In this case the deductee will be able to get his tds refund or he can adjust it against the tax payable.

Prince (Manager Accounts) (36 Points)
Replied 08 August 2011

Originally posted by : R K SINGH
	Hi prince, file tds return mentioning that amount paid 0 in the current year . In Tax deducted enter the TDS amount . In this case the deductee will be able to get his tds refund or he can adjust it against the tax payable.

Hi Mr. Singh,

Sir as i told you that the deuctor has already filed the revised return and in 26 AS the TDS is shown in P/Y 2009-10,but for the same year deductee has already filed his return and assesment u/s 143(3) is also done and thus he can't file revised return under section 139(5) seeking for TDS Refund.

One alternate available with deductee is that to file appeal u/s 154, but i am looking for relief under any other section of I.T Act.. Please let me know if we can find something as 154 is also known by advocates and if we also give the same solution to our client then what will be the line of demarcation between them and us??