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Tds on payment to banks

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(Querist)
17 November 2011 Whether the TDS is deductible on payment of Upfront Fee, Processing Fee & Syndication Charges to a Bank.
Our Client has recently taken a loan from a Bank and the syndication is in process. I am able to find one circular which says that no TDS would be deducted on interest payment to banks, but what about payment of Upfront Fee, Processing Fee & Syndication Charges, whether TDS is deductible or not ?
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CA SUMiT PATWARi

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CA SUMiT PATWARi (Expert)
17 November 2011 According to me, the terminology may be different, but in principal they are finance charges only.
Hence TDS need not be deducted on such payments made to Banks!
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Bhaskaran Chackrapani Warrier

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Bhaskaran Chackrapani Warrier (Expert)
17 November 2011 In view of section 2(28A) such payments are covered under section 194A(3)(iii)(a) and hence TDS provisions does not attract.
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