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T.d.s u/s 194c

Swami Ayyappa Nuli (TAX ADVISOR & CONSULTANT AT G.S.T SUVIDHA CENTER) (1372 Points)

21 December 2013

My client failed to deduct T.D.S on payment to contract and later realised and pay T.D.S to IT department along with Interest.He does not recover such amount of T.D.S and Interest from client.then is our client has a deduction of Such T.D.S amount and Interest paid on it while computing Income tax calculation?Plead an early replr,Thanks in advance

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CA KARAN MAINI (Practising CA) (106 Points)
Replied 21 December 2013

Sec.43B applies on deduction of tds deducted and deposited actually to credit of CG on or before due of ITR us 139(1) subject to that otherwise alloweable as deduction here tds not deducted but paid out of own pocket can not be allowed as deduction and all interest and penalities paid under direct tax lax laws are not allowed as deduction in computing total income.

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Dhruvi N suthar (Account Executive) (303 Points)
Replied 21 December 2013

HI All,

No your client is not allowed to take credit for the same because not directly deducted from his Income & income tax is direcr tax.

Allowed only if you deducted while making payment to your client..

Here you are paying out of your pocket so not allowed & one more thing if you are paying out of your pocket than how should your client come to know about the same...

CA Jeethender (Deputy manager finance) (49 Points)
Replied 22 December 2013

If there is any other payment ramaining to be made to the same the party the amount of TDS paid by your client on behalf of the party can be deducted/ recovered from the amount and balance amount can be paid to the party. However interest portion can not be deducted from such payment