TDS not deducted on due date

As we all know that TDS is to be deducted

1. At the time of credit ,or

2. At the time of payment

whichever is earlier (except salary)

My question is there is a bill which was booked in May 2005 but TDS was not deducted on the same. TDS was deducted in May 2009. If we find such an entry in audit what we should do?? please also discuss its tax consequences with reference to Sections and case laws, if any