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“short deduction of TDS”

DisallowancesSection 40(a)(ia)Section 40(a)(ia)177 judgments

The decision most relied on for short deduction of TDS is CIT v. Ansal Landmark Township (P.) Ltd. (61 Taxmann.com 45), cited in 177 judgments on BharatTax.

Leading authorities on short deduction of TDS

CIT v. Ansal Landmark Township (P.) Ltd.
61 Taxmann.com 45 · 2015 · High Court
177
citing judgments

Disallowance under section 40(a)(ia) cannot be made when the assessee has deducted tax at a lesser rate, as opposed to no deduction. The second proviso to section 40(a)(ia) is applicable retrospectively, mitigating disallowance where tax is deposited by the recipient.

CIT v. Nicholas Piramal India Ltd.
292 ITR 636 · 2007 · High Court
153
citing judgments

The deduction of tax at source under section 192 is not to be considered short if the employer makes a bona fide estimate of the taxable salary income of the employee.

CIT v. S.K. Tekriwal
361 ITR 432 · 2014 · High Court
150
citing judgments

Section 40(a)(ia) of the Income Tax Act does not apply to disallow expenses when there is a short deduction of tax at source. This includes situations where TDS is deducted at a lower rate than required or under an incorrect section.

DIT v. Jacabs Civil Incorporated/ Mitsubhishi Corporation
330 ITR 578 · 2011 · High Court
115
citing judgments

Interest under Section 234B is generally not leviable on non-residents whose income is subject to tax deduction at source under Section 195, provided the non-resident assessee did not induce short or non-deduction of TDS by the payer.

Ferro Alloys Corporation Ltd. v. CIT
196 ITR 406 · 1992 · High Court
37
citing judgments

Interest levied for delayed payment or short deduction of TDS is not an allowable business expenditure.

State Bank of India v. Assistant Commissioner of Income-tax
144 Taxmann.com 131 · 2022 · Supreme Court
35
citing judgments

An assessee is required to deduct tax at source on reimbursements, even if the assessee acted under a bona fide belief that such reimbursements were exempt.

DCIT v. Chandabhoy & Jassobhoy
49 SOT 448 · 2012 · ITAT
24
citing judgments

Section 40(a)(ia) is not applicable where tax has been deducted at source, even if at a lower rate than required, due to a difference in opinion regarding the nature of the payment.

(RE: CIT v. SK Tekriwal
90 DTR 26 · 2013 · High Court
20
citing judgments

Disallowance under Section 40(a)(ia) of the Income Tax Act for short deduction of TDS is not permissible if tax has been deducted, even if under a bona fide wrong impression of the correct TDS provision.

Judgments citing short deduction of TDS

M/S.Mahogany Logistics Services Pvt. Ltd., Madurai vs. PCIT, Madurai-1

In the result, the appeal filed by the assessee is dismissed

ITA 1631/CHNY/2024[2018-19]Status: DisposedITAT Chennai28 Jul 2025AY 2018-19

Bench: Shri S.S. Viswanethra Ravi & Shri S.R. Raghunathaआयकर अपील सं./I.T.A. No.1631/Chny/2024 िनधा"रण वष"/Assessment Year: 2018-19 M/S. Mahogany Logistics Services Vs. The Principal Commissioner Of Private Limited, Income Tax-1, 10, Jawahar Road, Chokkikulam, Madurai. Madurai 625 002. [Pan:Aafcd8781R] (अपीलाथ"/Appellant) (""थ"/Respondent) अपीलाथ" की ओर से / Appellant By : Shri N.V. Balaji, Advocate ""थ" की ओर से/Respondent By : Shri S. Senthil Kumaran, Cit सुनवाई की तारीख/ Date Of Hearing : 30.04.2025 घोषणा की तारीख /Date Of Pronouncement : 28.07.2025 आदेश /O R D E R Per S.S. Viswanethra Ravi: This Appeal Filed By The Assessee Is Directed Against The Order Dated 30.03.2024 Passed By The Ld. Principal Commissioner Of Income Tax 1, Madurai Under Section 263 Of The Income Tax Act, 1961 [“Act” In Short] For The Assessment Year 2018-19. 2. Brief Facts Of The Case Are That The Assessee Company [Earlier Known As M/S. Drsr Logistics Services Private Limited] Filed Its Return Of Income For The Ay 2018-19 Claiming Loss Of ₹.31,28,98,436/- Under 2

For Appellant: Shri N.V. Balaji, AdvocateFor Respondent: Shri S. Senthil Kumaran, CIT
Section 139(9)Section 143(3)Section 201Section 263Section 36Section 37Section 40

shares, lower amount of disallowance under section 40(a)(ia) and demand raised under section 201 of the Act for non- deduction and short deduction of TDS. The Assessing Officer completed the scrutiny assessment under section 143(3) r.w.s. 144B of the Act dated 25.08.2021 by disallowing

Wwics Estates Private Limited, Mohali vs. The DCIT/ACIT, TDS, Chandigarh

The appeal stands partly allowed

ITA 654/CHANDI/2022[2015-16]Status: DisposedITAT Chandigarh23 Jul 2025AY 2015-16

Bench: Hon’Ble Shri Rajpal Yadav & Hon’Ble Shri Manoj Kumar Aggarwal, Am आयकर अपील सं./ Ita No.654/Chandi/2022 (िनधा"रण वष" / Assessment Year: 2015-16) M/S Wwics Estates Private Limited Dcit / Acit Tds बनाम/ Vs. A-12, Industrial Area, Phase-6 Sector 17 Mohali. Chandigarh "थायीलेखासं./जीआइआरसं./Pan/Tan No. Aaacw-3524-A / Ptlw-10174-D (अपीलाथ"/Appellant) (""थ" / Respondent) : अपीलाथ"कीओरसे/ Appellant By : Shri Tejmohan Singh (Advocate) – Ld. Ar ""थ"कीओरसे/Respondent By : Dr. Ranjit Kaur (Addl. Cit) – Ld. Sr. Dr सुनवाईकीतारीख/Date Of Hearing : 15-07-2025 घोषणाकीतारीख /Date Of Pronouncement : 23-07-2025 आदेश / O R D E R Manoj Kumar Aggarwal () 1. Aforesaid Appeal By Assessee For Assessment Year (Ay) 2015- 16 Arises Out Of The Order Of Learned Commissioner Of Income Tax (Appeals) National Faceless Appeal Centre (Nfac), Delhi [Cit(A)] Dated 03-10-2022 In The Matter Of An Order Passed By Ld. Ao U/S 201(1) & (Ia) On 23-03-2022 Raising Certain Demand Against The Assessee. Having Heard Rival Submissions & Upon Perusal Of Case Records, The Appeal Is Disposed-Off As Under.

For Appellant: Shri Tejmohan Singh (Advocate) – Ld. ARFor Respondent: Dr. Ranjit Kaur (Addl. CIT) – Ld. Sr. DR
Section 133ASection 194Section 194CSection 194JSection 201(1)Section 44A

representation therein. The subject matter of appeal before us is - (i) Non-deduction of TDS on purchase of land for Rs.12.94 Crores; (ii) Short-deduction of TDS on payments of Rs.43.01 Lacs. 3. TDS on purchase of land for Rs.12.94 Crores 3.1 The assessee, during the course of real estate ... urban lands are not excluded from the purview of Sec.194-IA. Therefore, the adjudication of Ld, CIT(A) could not be faulted with. 4. Short Deduction of TDS on payment of Rs.43.01 Lacs 4.1 The assessee made payment for business promotion and advertisement and deducted TDS of 2% u/s 194C whereas