CA Vanamala Phani Kumar (Proprietor of M/s Vanamala and Co) (972 Points)
05 January 2012As per Sec 40(a)(i) cartein payments are not deductible from business income when TDS is not deducted
with in said dua dates...!!!!!!!!!!
My doubt is Mr.A deducted from Mr.X (contractor) of amount Rs.1,000 as per 194C on amount Rs.1,00,000 .
But Mr.A is deposited only Rs.500 to the credit of C.Govt .
In this case can Mr.A claim expenditure Part amount or not???
Thanks in advance
Prasad
(Sr. Manager)
(617 Points)
Replied 05 January 2012
Yes the Assessee can claim deduction to the extent of TDS deduction
CA Neil Ganatra
(Partner - Gautam Joshi & Co.)
(871 Points)
Replied 06 January 2012
Kindly go through the highlighted part. Following is the words in Act. As per the provisions even if tax is deducted but if not paid then that amount will not be allowable. i.e. it will be disallowed u/s 40(a)(ia)
any interest, commission or brokerage, 19 [rent, royalty,] fees for professional services or fees for technical services payable to a resident, or amounts payable to a contractor or sub-contractor, being resident, for carrying out any work (including supply of labour for carrying out any work), on which tax is deductible at source under Chapter XVII-B and such tax has not been deducted or, after deduction, 20 [has not been paid on or before the due date specified in sub-section (1) of section 139 :]
21 [Provided that where in respect of any such sum, tax has been deducted in any subsequent year, or has been deducted during the previous year but paid after the due date specified in sub-section (1) of section 139, such sum shall be allowed as a deduction in computing the income of the previous year in which such tax has been paid.]
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