venkatesh (CA) (137 Points)
30 December 2009TDS entry in the books of accounts is made in the month of May 2009. However Invoice corresponding to such TDS entry was passed in the moth of May 2005. Whether such TDS is dedcutible in AY 2010-11.
Further elaboration. TDS is paid for such invoice in the month of MAy 2009 under sec 195..commenting to shudhanshu- Invoice was booked in 2005 in the books of accounts however tds related to such invoice was accounted and deposited in may 2009. Still any elucidation is required????
shailendra
(C.A. FINAL)
(189 Points)
Replied 30 December 2009
Dear Venkatesh,
This issue is not clear, please mention the detailed issue, like TDS has been deposited in 05-06 or not.
Shudhanshu Agrawal
(Business)
(2570 Points)
Replied 30 December 2009
How it can be possible that an invoice which was issued in May 2005 is recorded in May 2009? In case of accrual accounting i dont think its possible. Please mention the full case.
samip karpe
(accounts assistance)
(152 Points)
Replied 30 December 2009
all People is Correct, Please explain
venkatesh
(CA)
(137 Points)
Replied 30 December 2009
shailendra
(C.A. FINAL)
(189 Points)
Replied 30 December 2009
ok now i will tell you......
TDS was deducted but not deposited in 2005, right. So the expense booked would have been disallowed in 05-06.
Now when the TDS has been deposited in May 2009, The Expense booked in 05-06 will be allowed in 09-10. Here the question should be of allowability of the invoice booked and not of the TDS.
Shudhanshu Agrawal
(Business)
(2570 Points)
Replied 30 December 2009
As you are saying that they have booked the expenses in may 2005. It means that they have deducted TDS at the time of booking the entry and if they are depositing that amount with interest now then as mentioned by shailendra expenses willbe allowed this year which was not alllowed earlier due to Section 40(a).
venkatesh
(CA)
(137 Points)
Replied 30 December 2009
Yes shailendra. But still my focus is not on invoice. I am concerned whether TDS which needs to be deducted long back almost 5 yrs back is now deducted and paid. NO doubt expense is disallowed. Whether there is any time bar for payment as invooice was actually booked in 2005
shailendra
(C.A. FINAL)
(189 Points)
Replied 30 December 2009
No there is no time bar for the payment of TDS. But you will have to deposit the TDS with interest.
according to me there will be two cases:-
If you deposit the TDS from your own pocket then TDS will not be allowed to you. Because TDS would have been booked as an exp. in P/L a/c
But if your recover it from the party then you must have debited the party's a/c and then deposited the TDS. In this there is no question of booking TDS as an exp. in P/L a/c.
Satisfied or not?
Need further clarification then tell me i will tell you the whole system of deducting TDS
venkatesh
(CA)
(137 Points)
Replied 30 December 2009
sudhanshu- TDS was deducted and paid both in 2009. No tds entry was passed in 2005. Only invoice amount was passed in the year 2005
CA LOVELY ARORA
(C.A. B.Com (H) Graduate)
(2151 Points)
Replied 30 December 2009
not possible............... it's only imagined case.......... not actual.............
venkatesh
(CA)
(137 Points)
Replied 31 December 2009
To the people who said its imagined case- I am on a audit currently where i have found such a case that y i am here with that quest. May b you ppl are dummy and may be the ppl who are non-dummy where able to ans rather than imagine the things.
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