tds not deducted on rent Owber has filed return with tax

This query is : Resolved

sita ram soni (Querist)
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29 June 2011 I could not deduct TDS on Building rent

Owner of building has filed his tax return for A Y 2011 12 with Income tax computed on REnt

What shouuld I do for better

CA Rajendra Purohit

CA Rajendra Purohit (Expert)
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30 June 2011 Required complete details..
1. Your assessment is done on individual, HUF or company or firm basis..?
2. If you are individual or HUF, then are you falling under tax audit requirement?
3. If you are company or firm then it is compulsion on your part to deduct TDS and if failed then required to Pay penalty for not deducting TDS.

Failure to Deduct TDS
If a person fails to deduct the whole or any part of TDS as required under any of the provisions of sections 192 to 196D then:
(a) The person responsible for deduction is treated as ‘assessee in default’
(b) He shall be liable to pay by way of penalty a sum equal to the amount which he failed to deduct.
(c) He shall be liable to pay simple interest @12% p.a. on amount of tax liable to be deducted.

sita ram soni

sita ram soni (Querist)
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03 July 2011 I am individual and my accounts are falling under tax audit

Please suggest any procedure for best action should i deposit TDS now and my House owner can claim thee TDS when he has already filed his Income Tax return

Or any other way whoich is best for me and house owner

CA Rajendra Purohit

CA Rajendra Purohit (Expert)
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03 July 2011 NO DOUBLE DEMAND OF TAX
Where the assessee has paid tax himself under section 191, the liability under section 201(1) shall be eliminated. (Clarification by Board(F.NO.276/201/96-IT (B) DATED 29.1.1997) however, this will not alter the liability to charge interest u/s 201(1A) or penalty u/s 271C.

However, in this case your rent expense will be disallowed u/s 40a.

The other option is...

Pay TDS amount with interest and ask your owner to file revised return and claim for refund. In this case you will be allowed to claim rent expenditure.

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