TDS short deduction-urgebt

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CA Rohit Garg (Querist)
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18 February 2011 sole proprieter has deducted the TDS on payment of interest to a company at a rate of 10% instead of 20% for the financial year 2007-08. NOw tax demans has been raised by the deaprtment(TDS wing)what to do?the tax deposited now will not be of benefit to the assessee and the company as the ITR cannot be revised.

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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18 February 2011

1. Pl check the applicability of proviso (turnover criteria) to section 194A(1) to the proprietor.
2. If applicable,the proprietor may try to convince the department with documentary evidence to the effect that the payee company has paid income tax on the interest and hence the short deducted amount if now recovered from the proprietor will lead to double taxation.

CA Rohit Garg

CA Rohit Garg (Querist)
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18 February 2011 Sir is there any specific section which say so?

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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18 February 2011 No sections. However, there are few case laws on identical situations in relation to "income from salary".

CA Rohit Garg

CA Rohit Garg (Querist)
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18 February 2011 Ok sir..Thanx..If u have any such case law plz reply with the same

Guest

Guest (Expert)

18 February 2011 You may try by not depositing balance TDS and opt to face penalty proceedings u/s 271C where you may get relief on the ground of ground realities and reasonableness.

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