Search Results For: tax deducted at source


QUERY: X purchased a vacant site in Andhra Pradesh from Y (Non-Resident) for sale consideration of Rs. 25,00,000/-, in the Financial Year 2010-11, without deducting TDS. Whether section 195 of the Income-tax Act, 1961 would be applicable?
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The objective of this section is to ensure that the tax on the income of non-residents and foreign companies is deducted at source, so that the department is not put to the trouble of recovering it from such persons whose connections with India,

QUERY: Whether TDS u/s. 195 is required for advertisement on Facebook, Google etc?

In the era of e-commerce and social networking, a lot of Indian Companies are using social marketing by placing advertisement on sites like Facebook, Google etc. These sites are owned by non-residents and payments are usually made using credit cards. Whether TDS provision u/s. 195 are applicable to such payments? Further website neither allows any reduction in payments nor their PAN is available with the payer. In such scenario how TDS obligation is to be discharged?
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No TDS is required to be deducted, as neither of the above companies have PE in India and payments made to them for advertisement cannot be considered as ‘royalty’ as held by the Mumbai Tribunal

QUERY: XYZ is engaged in the business of manufacturing and export of various chemicals. It pays commission to various overseas agents, who procures orders for it from outside India. The Commission is payable only on actual export sales routed through the agents. The question is whether it is necessary to deduct tax at source under section 195 on export commission in view of withdrawals of circulars bearing no. 23 dated July 23,1969 and bearing no. 786 dated February 7, 2000.
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Even though, the circulars stated above have been withdrawn vide circular no. 7 of 2009 dated October 22,2009, no TDS is required to be deducted as no income is chargeable to tax under section 195 of the Income-tax Act, 1961, as non-resident selling agents have rendered the services outside India for procuring the orders and commission is payable to them outside India.

QUERY: A demand has been raised on ‘X’ for the short credit in 26AS in respect of TDS deducted by the deductor but not paid to the Government. Whether ‘X’ is liable to pay the demand.
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Section 205 of the Income-tax Act, 1961 provides that in case tax is deductible at source under chapter XVII of the Act, the assessee shall not be called upon to pay the tax himself to the extent of the deduction so made irrespective of the fact whether the tax so deducted has been actually deposited with the Government by the payer.

QUERY: 1. Can section 206AA (higher TDS in case of non furnishing of PAN by payee) be taken as overriding the provisions of DTAA?
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Section 206AA of the Income-tax Act, 1961, reads as under:

“(1) Notwithstanding anything contained in any other provisions of this Act, any person entitled to receive any sum or income or amount, on which tax is deductible under Chapter XVIIB (hereafter referred to as deductee)

QUERY: Where the assessee was in default in filing of return, though the T.D.S. was deposited in time, save himself from penalty u/s. 272A(2)(c)?
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When TDS was deposited in time, there is no loss to the revenue. However, non filing TDS return is a technical default.

In Hindustan Steel Ltd. vs. State of Orissa [83 ITR 26]; the Supreme Court has held that, even if a minimum penalty is prescribed, the authority competent to impose the penalty will be

QUERY: Whether TDS u/s. 194A is deductible on payment of credit card? Several entities have been receiving notices regarding non-deduction of TDS u/s. 194A on charges paid to banks towards use of credit card facilities used by them as merchant establishments. Whether these charges would be covered by the term ‘interest’ and would get covered under the said section?
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S. 2(28)(a) defines ‘interest means interest payable in any manner in respect of any moneys borrowed or debt incurred (including a deposit, claim or other similar right or obligation) and includes any service fee

QUERY: X Ltd. has issued debentures on which interest is payable every six months on December 31st and June 30th. The debentures are listed on the stock exchange. As per the consistently followed accounting practice, the company has made provision for interest on debentures for the period January 2010 to March 2010. However, it has neither deducted nor paid the TDS in respect of such provision. The tax is deducted and paid on or after each coupon date, and hence will be deducted and paid on 30th June, 2010. Certificates for TDS will be to the persons who are the registered holder of debentures as on the coupon date. The company wants to reconfirm whether the practice followed by it is correct in law or not? Please advise the company as to whether the amount of interest provided has to be included in the quarterly E-TDS return for March, 2010? Whether interest debited in P & L A/c. would be disallowed under section 40a(ia) of the Act?
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– From January 1 to March 31, 2010, “interest accrued but not due”, for which provision has been made in the accounts. However, it will be due only on June 30, 2010 and would be credited to payees account or suspense account or payable account

QUERY: Where Non-Residents are deputed to work in India and taxes are borne by employer, if any refund becomes due to the employee after he has already left India and has no bank account in India by the time the assessment orders are passed, whom the refund can be issued?
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The refund can be issued to the employer as the tax has been borne by it.

QUERY: If the employer has made excess deduction of tax at source in case of bulk return of an employee what is the remedy available to the employer and under which section?
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If employer has deducted excess tax on bulk return, then, the employees have to obtain the refund authorizing employer to collect or indicate the bank account number,