Tds for firms

This query is : Resolved

B.P. SRIDHAR (Querist)
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16 June 2013 SIR,
A PARTNERSHIP FIRM DOING BUSINESS IN ADTHI AND COMMISSION IS PAYING INTEREST TO ITS FARMERS ABOVE 10,000/- P.A. IS IT MANDATORY TO DEDUCT TDS FROM FARMERS WHO ARE NOT I.T. ASSESSEES. PL CLARITY.

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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16 June 2013 Please go through the decision given by the ITAT Hyderabad.

http://rakeshsanghvi.blogspot.in/2012/08/interest-paid-to-sundry-creditors.html
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As per Section 2(28A) Interest means interest payable in any manner in respect of any moneys borrowed or debt incurred (including a deposit,claim or other similar right or obligation) and includes any
service fee or other charge in respect of the moneys borrowed or debt incurred or in respect of any credit facility which has not been utilised;
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Whereas in the instant case, the farmer is being paid interest on the amount due for the goods sold by him,
so, by following the above decision you may not deduct TDS.
.

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