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section 40(a)(ia)

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Disallowed Expenses While Calculating Profits & Gains of Business or Profession

Income Tax : Learn about disallowed expenses under PGBP in India's Income Tax Act. Understand key sections like 37, 40, and 40A, and their impa...

October 7, 2024 7311 Views 0 comment Print

Disallowances covered under Income-Tax Act and Reporting in Tax Audit

Income Tax : Learn about disallowances under Income Tax Act sections and their reporting requirements in Form 3CD during tax audits. Key provis...

September 29, 2024 5169 Views 0 comment Print

TDS Obligations: Reimbursement of Expenses vs. Fee for Technical Services

Income Tax : Delhi HC rules reimbursements to NRAEs not subject to TDS as "fees for technical services," clarifying scope of Section 9(1)(vii) ...

September 25, 2024 1311 Views 0 comment Print

Income Tax Deductions allowable to tax payer

Income Tax : Explore allowable tax deductions for AY 2025-26, covering salaries, house property, business, and personal expenses. Maximize your...

September 7, 2024 1866 Views 0 comment Print

Income Tax Practices: Common Mistakes and Solutions

Income Tax : Explore crucial issues in income tax practices, including Section 44AD, TDS obligations, LTCG exemptions, cash deposits, and tax d...

September 18, 2023 4899 Views 0 comment Print


Latest News


Section 40(a)(ia): Disallowance of expenditure for non-deduction of tax at source on payment made to resident

Income Tax : Section 40(a)(ia) is amended via Finance (No. 2) Act, 2014 to restrict the amount of disallowance for non-deduction of tax to 30% ...

January 21, 2018 150219 Views 3 comments Print

Change in provisions related to disallowance of expenditure on account of non-compliance with TDS provisions : Budget 2010-11

Income Tax : The existing provisions of section 40(a)(ia) of Income-tax Act provide for the disallowance of expenditure like interest, commissi...

February 26, 2010 906 Views 0 comment Print


Latest Judiciary


Provision of Spa Consultancy falls under ‘Independent Personal Services’ hence not taxable in India

Income Tax : ITAT Delhi held that fees for providing Spa Consultancy falls under the category of ‘Independent Personal Service’ and hence w...

May 8, 2025 207 Views 0 comment Print

Order solely based on judgement which was over-ruled by Apex Court is liable to be quashed

Income Tax : Jharkhand High Court held that order solely based on the judgement which has been later on over-ruled by the Hon’ble Apex Court ...

May 8, 2025 270 Views 0 comment Print

No disallowance u/s. 43B when deduction not claimed in P&L account

Income Tax : ITAT Ahmedabad held that no disallowance under Section 43B of the Act can be made when deduction is not claimed in the profit and ...

May 5, 2025 117 Views 0 comment Print

Subscription fees for e-magazine doesn’t partake character of Fee for Technical Service

Income Tax : The present appeal has been preferred by the revenue. The controversy involved in the present appeals pertains to the treatment of...

May 5, 2025 204 Views 0 comment Print

Section 40(a)(ia) Disallowance Unwarranted: Section 194C TDS Not Applicable to EDC Payments

Income Tax : The assessee company, engaged in the business of real estate, having multiple ongoing projects of construction and also selling up...

May 3, 2025 144 Views 0 comment Print


Latest Notifications


Disallowance for failure to withhold tax- Sec.195 rw Sec. 40(a)(i)

Income Tax : Circular No. 3/2015 Section 40(a)(i) of the Act stipulates that in computing the income chargeable under the head "Profits or gain...

February 12, 2015 5268 Views 0 comment Print

S. 195 AOs to tax taxable part of sum paid to NR for TDS default

Income Tax : Sub: Deduction of tax at source under Section 195 read with Sections 201 of the Income-tax Act, 1961 relating to payment made to a...

February 26, 2014 13352 Views 0 comment Print

CBDT circular on Section 40(a)(ia)-TDS Disallowance

Income Tax : Circular No. 10/DV/2013-Income Tax It has been brought to the notice of the Board that there are conflicting interpretations by j...

December 16, 2013 20168 Views 0 comment Print


On failure to deduct TDS on web charges amount is disallowable U/s. 40(a)(ia)

March 12, 2013 1934 Views 0 comment Print

Indisputably, payment of Rs. 29,857/- has been made to M/s Network Solutions for downloading software and provisions of sec. 194J of the Act are attracted. The provisions of said sec. 194J lay down that any person, not being an individual or a Hindu undivided family, who is responsible for paying to a resident any sum by way of (a) fees for professional services, or (b) fees for technical services, or (c) royalty, or (d) any sum referred to in clause (va) of section 28, shall, at the time of credit of such sum to the account of the payee or at the time of payment thereof in cash or by issue of a cheque of draft or by any other mode,

Amendment to sec. 40(a)(ia) vide Finance Act, 2010 was retrospective in nature

March 4, 2013 698 Views 0 comment Print

Bare perusal of the scheme of Chapter XVII-B shows that it mandates the person responsible for paying any sum out of which tax is required to be deducted at source to deduct the requisite amount of tax at source out of the amounts paid/credited by him. Deduction of tax is made out of the amounts paid/credited by the person responsible for paying/crediting the same.

Fees paid to Non resident for services rendered in relation to business carried outside India is not taxable in India

March 1, 2013 8112 Views 1 comment Print

In the instant case also services were provided by the assessee outside India and for this business the services of non-residents were utilized to whom technical fee in question was paid. No good reason could be shown by the DR as to why the aforesaid decision of the Tribunal is not applicable in the instant case and why the said decision should not be followed in the instant case. We, therefore, following the above decision, hold that the services of non-residents to whom the technical fee of Rs. 74,63,768/- was paid by the assessee were utilized for the business which was carried out outside India for earning income from a source outside India. Therefore, the grounds of appeal of the assessee are allowed.

TDS cannot be postponed till last date of accounting period, HC ruling in virgin Creations will not apply

February 22, 2013 2175 Views 0 comment Print

A judgment is an authority for what it decides. It applies only to those cases in which the requisite amount of tax has been deducted at source out of payments made to the payee and thereafter deposited on or before the due date stipulated by law.

Amendment to s. 40(a)(ia) by Finance Act, 2008, is WEF from 1-4-2005

February 1, 2013 654 Views 0 comment Print

It is not in dispute that on the date the assessee deducted the tax, he had to pay/remit the money within seven days from that date and if the amount is actually paid when the credit is given, then the tax is payable within two months. Admittedly, in the instant case, the assessee did not comply with the legal requirement.

Amendment in Section 40(a)(ia) In Finance Act, 2012: Rerospective or Prospective

January 28, 2013 7785 Views 0 comment Print

Ever since the insertion of provision of Section 40a(ia) ( “the section”)through finance act, 2004, the subject of TDS has gained a lot of momentum in terms of anxiety from general public. Non deduction or even untimely deduction of tax results to disallowance or deferment of allowance of expenditure,

Amount disallowed u/s. 40(a)(ia) not eligible for deduction u/s. 80IB

January 9, 2013 3718 Views 0 comment Print

It is settled principle that the deeming fiction created under any provisions of the Act cannot be imported into a beneficial provisions of the Act. In this case, the addition made on account of disallowance of expenditure is due to the deeming fiction created by the penal section 40(a)(ia) of the Act. Thus, the effect of the same cannot be imported into a beneficial provision vis-a-vis section 80-IB(10) of the Act.

Matter related to Applicability of TDS on payments of air fare to freight agents located abroad remanded back to ITO

January 1, 2013 46595 Views 0 comment Print

As rightly submitted by the learned DR, one of the reasons given by the AO for making disallowance u/s 40(a)(ia) was that the payment of freight charges was made by the assessee on account of air fare and not shipping charges and even the said air fare was not directly paid to the airlines but the same was paid to the different parties who acted as freight booking agents.

No s. 40(a)(ia) Disallowance For Short-Deduction TDS Default

December 11, 2012 5374 Views 0 comment Print

Section 40(a)(ia) of the Act refers only to the duty to deduct tax and pay to government account. If there is any shortfall due to any difference of opinion as to the taxability of any item or the nature of payments falling under various TDS provisions, the assessee can be declared to be an assessee in default u/s. 201 of the Act and no disallowance can be made by invoking the provisions of section 40(a)(ia) of the Act.

HC Stays Special Bench Verdict On Disallowance u/s. 40(a)(ia)

December 11, 2012 1442 Views 0 comment Print

Petition under Section 151 of CPC praying that in the circumstances stated in the affidavit filed herein, the High Court may be pleased to suspend the operation of the order passed by the Income Tax Appellate Tribunal, Visakhapatnam Bench, Visakhapatnam, in its I.T.A.No. 477/Vizag/2008, dated. 09-04-20 12, pending ITTA.No. 384/2012 preferred to the High Court against the order of the Income Tax Appellate Tribunal, Visakhapatnam Bench, Visakhapatnam in ITA.No. 77/Vizag/2008 dated. 09- 04-2012 for the Assessment Year 2005-2006.

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