Short deduction of tds for ay 12-13 cosequences?

This query is : Resolved

Atul Masurkar (Querist)
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20 February 2014 My client deduct TDS at lesser rate than mention u/s 194 C- for partnership firm TDS rate is @ 2% as against they deduct @ 1% now traces show me demand of 1% of TDS which is short deduction. Is my client require to pay short deduction? provided my clients's Contractor claim in their return of income tds credit of only 1%. if suppose I paid the 1% of TDS which is demanded by traces /AO is my clients contractor getting credit for that after revising return(so that I can recover the amount from Contractor)? What deduction shall my client get u/s 40(a)(i).
please reply?

Nikhil Kaushik

Nikhil Kaushik (Expert)
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24 February 2014 1 yes you are required to pay the short deductions.

2. yes the contractor will be able to claim deduction of this additional 1% also. Your client can recover the same from the contractor

3. the deduction is for the amount paid to the contractor.

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Atul Masurkar

Atul Masurkar (Querist)
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18 July 2014 if suppose date of revised return of contractor is time barred, then in that case what is remedy to contractor?

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Nikhil Kaushik

Nikhil Kaushik (Expert)
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18 July 2014 then you can file application under section 119(2) for claiming remaining credit of taxes.