Cash system of accounting & tds payable

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This query is : Resolved

Vijay Thakkar (Querist)

26 November 2014 An Assessee is following Cash System of Accounting. He has paid Interest on Unsecured Loans on 31st March and TDS was deducted @ 10%. TDS amount was paid to the credit of Central Govt. in April.

In scrutiny assessment, Assessing Officer is of the vies that as the TDS amount was not paid in March but paid in April, expenditure to the extent of TDS amount is not actually paid in the previous year and hence not allowable under Cash System of Account.

Your views are requested on this matter. Some related case laws be informed.

Thanks.

Amol S Joglekar

Amol S Joglekar (Expert)

26 November 2014 Assesing officer is NOT correct.
The assessee has paid the TDS which is legitimately allowed to be paid by the Income tax Act, all types of acounting systems as envisdaged under section 145.
Separate dates of payment of TDS are not given under Income Tax Act for different methods of accounting. Give a written submission to that effect so that in case the Assessing officer vehemently makes the assessment order, your submission will stand good at the time of appeal.
(Just a query....ask him is he ready to allow the expendiure of 2013 march on the same analogy and reopen the earlier cases based on his way of interpretation?)