TDS On Capital Expenditure/Payment

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This query is : Resolved

Neeraj (Querist)

14 May 2008 I want to know that TDS is appilcable only on revenue payment or it is applicable for revenue or capital payment both. please give full reference like case laws , notification and circular.

S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)

14 May 2008 TDS is applicable to both the payments, if the nature of payment falls within the purview of TDS sections. There is no doubt or controversy on that issue.

RICKY

RICKY (Expert)

14 May 2008 Hi... TDS is applicable only to Payments to Expenses but not for payments to Assets.

Read the section.. then u will know..

CA. Ashish Bihani

CA. Ashish Bihani (Expert)

18 January 2011 Dear Experts,

Can we please get a clear idea about the same???

Thanks..

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)

31 March 2012 The chapter of TDS does not make a distinction between capital payments and revenue payments.

If the payment falls withinh the scope of the Section, TDS shall be deducted.

For instance, TDS u/s 194C is to be deducted on payments made to a contractor.

Construction of a building is a capital expenditure, but TDS is required to be deducted on such expenditure.

So, nature of expense is to be seen and not whether it is capital or revenue.

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