How to Handle Wrong TDS Credit and PAN Mismatch in Doctor-to-Doctor Hospital Rent Agreements (Sectio

This query is : Resolved

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A landlord doctor received ₹1 crore in professional fees intended for a tenant doctor, with TDS under Section 194J deducted and appearing on the landlord's AIS. The healthcare trust cannot reissue the TDS certificate. The suggested solution involves the tenant doctor adjusting rent payments, deducting TDS on rent, and transferring any excess to the landlord. Both doctors must correctly report the income and TDS in their respective Income Tax Returns (ITRs) to ensure accurate tax compliance.

Kollipara Sundaraiah

Kollipara Sundaraiah (Querist)
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23 July 2025 SIR,
A doctor (landlord) has rented out their hospital premises to another doctor (tenant), who provides healthcare services there. The tenant doctor earned ₹1 CRORE lakhs from a healthcare trust for medical services rendered, but the payment was mistakenly credited to the landlord doctor’s bank account. TDS under Section 194J was deducted, and this amount is now showing in the landlord doctor’s AIS (Annual Information Statement), linked to their PAN.
The healthcare trust has stated that it cannot change the PAN or reissue the TDS certificate.
For income tax compliance, how should the ₹1 CRORE be correctly transferred from the landlord to the tenant doctor? Can this transfer be done without triggering further TDS or tax implications? What is the correct procedure to document this transfer and clarify ownership of income for tax purposes?”

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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23 July 2025 1. Tenant doctor should adjust the rent payment from the fees collected by owner doctor. He should deduct TDS over rent & pay it to treasury. Any excess rent amount be paid to owner doctor by bank transfer.
2. While filing ITRs owner doctor should report the TDS (professional fees) belonging to tenant doctors PAN. He should only claim TDS over rent against rental income.
3. IN ITR of Tenant doctor he should add the income & TDS deduction in his Schedule TDS2 of ITR.

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Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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25 September 2025 Good luck...

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