HI FRIENDS,
I am doing one tax audit, inwhich they are paid around 40lacs to bank towards processing fees , whether company is liable to deduct TDS on the above amount, if yes under which provision, kindly reply me soon.
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tds on processing fees
Replies (5)
Sanjaya
There is no TDS becoz , ther is specifically exclusion of BANKING COMPANY is section 194A . So please refer section.
ANd if you talked about processing fees then it is specifically exclude from the purview of definition of Interest as per Income tax act...........
Section 194 J. Technical Services. Technical services includes managerial and secretarial service. There is no specific exclusion for banks in section 194J. Only in 194A. Therefore 10% + surcharge etc. if over 20,000 per annum.
194A excludes banks , loan processing fees is included in Interest u/s 2(28A) , so no TDS ...Question of 194J doesnt arise , as loan processing fees is interest ..i think there is a Sc judgement on this 224 ITR 551
No Doubt, Banking Companices are exempted from this area.
If there is a provision like that then bankers have to open a department for collection of !6a, because that much of Certificates it will have.
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