TDS

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This query is : Resolved

Ashish (Querist)

29 July 2010 Hi!
What are the consequences of non deduction of TDS u/s 194C. Please give me the detail consequences alongwith the penalties. Also if the expenses,related to which TDS should be deducted has not been deducted, and has been disallowed and added back to the profit for the purpose of computation of total income, so whether the company needs to deduct the tax later and remit it to the government or the matter is solved, and also any penalty will be imposed on the company.

Thanks
Ashish Agarwal

srinath

srinath (Expert)

29 July 2010 interest @ the rate of 1.5% pm or part of month is payable from the date on which it is liable til it is paid

penalty equal to the amount of tax is payable

the assessee becomes assessee in default

expense would be disallowed u/s 40a(ia). it would be allowed in the year in which such TDS is deducted and paid

Ashish

Ashish (Querist)

29 July 2010 Hi Srinath!
Suppose the company wants its expenses to be added back and does want to deduct the TDS amount in future also. Then please tell me whether this is legal and the company is on the right path as the company is paying tax on the disallowed amount and its more than the TDS amount.

Thanks
Ashish Agarwal

srinath

srinath (Expert)

30 July 2010 no... def not correct. cos disallowance of exp is only one of the penal provisions for TDS

suppose u pay a contractor some fees for construction of building.. the exp is going to be capitalised. then even for this TDS should be deducted

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