Liability to deduct TDS

Dear All,

    Please help me to resolve my querry.

Suppose, a life insurance co. A ltd. has two branches- 'X' Branch and 'Y' Branch which deal in different-2 type of life insurance...

An agent Mr. Ram is registered in 'Y' Branch...

He has done some business for 'X' branch, and he has earned commission of Rs. 5000...

'X' branch debits commission and credits 'Y' branch without deducting TDS of Rs. 500......

Now, 'Y' branch is paying to Mr. Ram after deducting TDS

Is this treatment correct in light of the provisions of Sec. 194H of the Income Tax Act....???

 

Thanks

Replies (1)

Agent Mr Ram is agent of company and his sitting space registered is Y, but he is not barred to do business of X branch products. 

Here the deductee is company, not the branch, as the accounts and payouts of Mr Ram belong to Y branch, X dont like to open a new ledger for Mr Ram and transferred ( not paid) the whole amount to Y, where Y included the business credit and commission on X branch with Y branch and deducted TDS accordingly. 

Repeat once again, commission is paid by company and its accounted at branch, so the TDS deductee is company for both branches. 

company has done the process in very correct way.

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