tax deducted for a non trading association

CA Gaurav Agrawal (Credit Analyst) (60 Points)

19 August 2009  

The facts of case

One Non-Trading Association which collects maintenance charges from Members and spends the amount collected for the maintenance of building. Every year saved money is invested in Bank FDR. The Bank is deducting TDS on income earned as Interest.

Questions:

a) How one can stop the Bank for deducting the Tax? Whether there are any arrangements of form for this purpose??

b) The Association collects around 10 lacs as maintenance charges and spends around 8 lacs per year and interest income around 3 lacs per year. Whether return filling is compulsory? Whether there is any exemption limit available to association?

c) Return of 31/03/2007 and 31/03/2008 were not filled but TDS is deducted. Whether tax deducted during 2006-07 and 2007-08 is recoverable?