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Tds

siva nagi reddy .p (Service) (53 Points)

05 June 2015

what are the consequences in case TDS not deducted for services received in relation to capital expenditure

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10 Replies

CMA Poornima Madhava (CMA) (13112 Points)
Replied 05 June 2015

Interest @ 1% pm or part thereof, from the date to be deducted till the date of deduction
Interest @ 1.5% pm or part thereof, from the date of deduction till the date of payment
Late filing fees u/s 234E
There will not be any disallownce u/s 40a

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deepak (Job) (69 Points)
Replied 05 June 2015

In addition to above consequences,

you can be treated as " assessee in default" and penalty equal to TDS amount can be levied by Department.

Krishna Chaudhary (student) (76 Points)
Replied 05 June 2015

depreciation on that capital expenditure not allowed

CMA Poornima Madhava (CMA) (13112 Points)
Replied 05 June 2015

@ Krishna: I have a different view. Depreciation as such is not an expenditure and hence it cannot be disallowed as I understand.

https://taxlawsjournal.wordpress.com/2011/03/25/section-40a3-capital-assets/

Krishna Chaudhary (student) (76 Points)
Replied 05 June 2015

Originally posted by : Poornima Madhava
	@ Krishna: I have a different view. Depreciation as such is not an expenditure and hence it cannot be disallowed as I understand. https://taxlawsjournal.wordpress.com/2011/03/25/section-40a3-capital-assets/

Thanks Poornima for updating my views as i was not aware of the case law

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siva nagi reddy .p (Service) (53 Points)
Replied 06 June 2015

thank u

Ashok J (CA Final) (880 Points)
Replied 06 June 2015

Hello Poornima

pls explain why there is no disallowance......as far as i know, 194J uses the word TDS should be deducted on payment of any tech/prof fee and not the word rev/cap exp

siva nagi reddy .p (Service) (53 Points)
Replied 06 June 2015

hello

but Tds softw

hi poornima

E-TDS software is not accepting the loss from let out , but loss self occupied is up to 2lakhs

CMA Poornima Madhava (CMA) (13112 Points)
Replied 06 June 2015

@ Ashok: Here the discussion is not about 194J but abt TDS on capital expenditure. There cannot be disallowance bcoz they r part of capex (not revenue). As u say, fee for technical services or professional service is revenue expenditure only but here the query pertains to capex

Aditya Sharma (finance advisory) (377 Points)
Replied 07 June 2015

Hello Siva,

First of all you have not mentioned exact kind of service provided coz in realtion to capital expenditure it could have related to many provisions such as Sec. 194-J/194-I/194H.

However as per your post telling loss from house property I PRESUME THAT IT IS IN RELATION TO HOUSE PROPERTY and either would be covered as FEES FOR PROFESSIONAL SERVICES U/S 194 -J OR PAYMENT TO CONTRACTOR U/S 194 -C .....IN BOTH THE CASES TDS IS NOT REQUIRED TO BE DUDUCTED IF IT IS FOR PERSONAL USE OF INDIVIDUAL/HUF and also not required if their tunover does not exceed 1 crore in previous year.