Tds on interest on nbfc

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anuj (Querist)
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24 September 2014 As per section 194(A) below per person liable to dedut TDS

1) Any person, not being an individual or a Hindu undivided family, who is responsible for paying43 to a resident any income by way of interest43 other than income 44[by way of interest on securities], shall, at the time of credit of such income to the account of the payee45 or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct income-tax thereon at the rates in force :

46[Provided that an individual or a Hindu undivided family, whose total sales, gross receipts or turnover from the business or profession carried on by him exceed the monetary limits specified under clause (a) or clause (b) of section 44AB during the financial year immediately preceding the financial year in which such interest is credited or paid, shall be liable to deduct income-tax under this section.]

Now my question is
I am proprietor covered under section 44AD.
Am i liable to deduct tds on interest paid to NBFC (Loan Against Property) if my total sale not exceed 100 Lakh under 44AB(A), but my books liable to get audited as we are showing net profit below 8% under section 44AD

Nikhil Kaushik

Nikhil Kaushik (Expert)
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24 September 2014 no. getting audit done under 44AD(5) read with 44AB(d) doesn't create obligation for deduction of taxes on payments made. Such obligation arise only when your turnover crosses 44AB Clause (a) or (b) turnover. Since you are covered under 44AB(d), the proviso doesn't apply to you.

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