“TDS on rent”

TDS / TCSSection 194ISection 194I50 judgments

The decision most relied on for TDS on rent is CIT v. NIIT Ltd. (318 ITR 289), cited in 79 judgments on BharatTax.

Leading authorities on TDS on rent

CIT v. NIIT Ltd.

318 ITR 289 · 2009 · High Court

citing judgments

A composite agreement, even if charges are broken down, cannot be dissected to apply Section 194I for TDS on rent when the agreement is a business arrangement for mutual obligations.

CIT (TDS) v. Maharashtra State Electricity Distribution Co. Ltd.

375 ITR 23 · 2015 · High Court

citing judgments

Payment for transmission or wheeling of electricity does not constitute rent under Section 194-I of the Income Tax Act as it does not involve payment for the use of land, building, or machinery, and possession is a necessary element for rent.

Rajesh Projects (India) (p.) Limited v. Commissioner of Income-tax

78 Taxmann.com 263 · 2017 · High Court

citing judgments

An assessee is not liable for TDS default under section 201(1) on payments to NOIDA Authority for lease rents, but the interest liability under section 201(1A) may still apply if the deductee has offered such income. However, the conclusion regarding TDS default applies prospectively.

Japan Airlines Co. Limited v. CIT

377 ITR 372 · 2015 · Supreme Court

citing judgments

Payments for services are not rent and thus do not attract TDS under Section 194-I of the Income Tax Act, unless the payment is specifically for the use of an asset in the nature of land, building, machinery etc. Section 194C applies to such service payments.

ITO v. Tejmalbhai & Co.

99 ITD 399 · 2006 · ITAT

citing judgments

The section under which tax is deducted at source (TDS) by the payer does not determine the nature of income in the hands of the recipient. Income received as rent is assessable as business income, not income from house property, even if TDS is wrongly deducted under Section 194-I.

ACIT v. Accenture Services (P.) Ltd.

44 SOT 290 · 2011 · ITAT

citing judgments

Payments for hired taxis, where the operator retains possession and control, are subject to TDS under section 194C, not section 194-I. Section 194-I does not apply to payments for transport services involving the use of vehicles if possession is not transferred.

Karwat Steel Traders v. ITO

145 ITD 370 · 2013 · ITAT

citing judgments

Disallowance under section 40(a)(ia) for non-deduction of TDS on rent or interest payments is deleted if the recipient has furnished Form 15G, as this indicates no tax was deductible at source or tax was not required to be deducted.

Sunil Kumar Gupta v. ACIT

389 ITR 38 · 2016 · High Court

citing judgments

Common Area Maintenance (CAM) charges paid by a tenant are considered rent and are subject to TDS under Section 194-I of the Income Tax Act, even if paid to a third party, as the term 'rent' is broadly interpreted to include payments for the use of property and associated services.

Judgments citing TDS on rent

Grand Motors, Bilaspur vs. Deputy Commissioner of Income Tax, CPC, Bengaluru

In the result, the appeal filed by the assessee is allowed for statistical purposes in terms of our aforesaid observations

ITA 167/RPR/2022[2017-18]Status: DisposedITAT Raipur17 Jul 2023AY 2017-18

Bench: Shri Ravish Sood & Shri Arun Khodpiaआयकर अपील सं. / Ita No. 167/Rpr/2022 "नधा"रण वष" / Assessment Year : 2017-18 Grand Motors Nh-200, Raipur Road, Bilaspur (C.G.) Pan: Aakfg6077H .......अपीलाथ" / Appellant बनाम / V/S. The Deputy Commissioner Of Income Tax, Cpc, Bengaluru ……""यथ" / Respondent

For Appellant: Shri R.B Doshi, CAFor Respondent: Shri Choudhary N.C. Roy, Sr. DR

Section 143(1)Section 40

Entry Tax. iii) That the ld. CIT(A) erred in sustaining addition of Rs. 3,47,250/- on account of non-deduction of TDS on Rent, Contract payment, professional fees and Interest. 6. That the ld. CIT(A) erred in sustaining addition of Rs. 83,23,022/- on account

Triune Energy Pvt. Ltd., New Delhi vs. ACIT Circle-7(1), New Delhi

The appeal stands allowed

ITA 2096/DEL/2019[2008-09]Status: DisposedITAT Delhi21 Jun 2023AY 2008-09

Bench: Shri Anil Chaturvedi & Shri Anubhav Sharmaassessment Year: 2008-09

Section 143(3)

Learned CIT(Appeals) had sustained additions on account of provision made on account of performance service incentives; non deduction of TDS on rent account; expenditure incurred n repairs & maintenance of lease-hold building; legal and professional expenses of international audit; and expenditure incurred on software purchases which have been challenged

Rajesh Kumar Gupta, New Delhi vs. ITO, Ward- 42(4), New Delhi

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

ITA 4684/DEL/2018[2014-15]Status: DisposedITAT Delhi07 Mar 2023AY 2014-15

Bench: Shri C.M. Gargassessment Year: 2014-15 Rajesh Kumar Gupta, Vs. Ito, C-1/11, Garg Niwas, Ward-42(4), Upper Ground Floor, New Delhi. West Enclave, Pitampura, New Delhi – 110 034. Pan: Aeipg1451K (Appellant) (Respondent) Assessee By : Shri Gurjeet Singh, Ca Revenue By : Shri Om Prakash, Sr. Dr Date Of Hearing : 13.12.2022 Date Of Pronouncement : 07.03.2023 Order This Appeal Filed By The Assessee Is Directed Against The Order Of The Cit(A)-14, New Delhi, Relating To Assessment Year 2014-15. 2. The Assessee Has Raised The Following Grounds Of Appeal:- “1. Because The Action Is Being Challenged On Facts & Law, For Upholding The Addition Of Rs. 12,98,000/- On Account Of Cash Deposit In Saving Bank Account Treating The Same As Undisclosed Income. 2. Because The Action Is Being Challenged On Facts & Law, For Upholding The Addition Of Rs. 3,00,000/- Treating Gift Received By Assessee From His Mother & Utilized By Him For Tour & Travelling Expenses As Undisclosed Income. 3. Because The Action Is Being Challenged On Facts & Law, For Upholding The Addition Of Rs. 3,15,000/- Treating Rent Received From M/S Vm Rubber Industries As Undisclosed Income Whereas Per Assessee Tds Thereon Has Been Wrongly Deducted By The Tenant U/S 194J Instead Of 1941 While Filing Its Tds Return. Prayer For Any Consequential Relief And/Or Legal Claim Arising Out Of This Appeal & For Any Addition, Deletion, Amendment & Modification In The Grounds Of Appeal Before The Disposal Of The Same In The Interest Of Substantial Justice To The Assessee.”

For Appellant: Shri Gurjeet Singh, CAFor Respondent: Shri Om Prakash, Sr. DR

Section 194JSection 44A

assessee filed confirmation-cum-certificate from tenant M/s V.M. Rubber Industries Pvt. Ltd. wherein it was categorically explained that they had deducted TDS on rent for the period falling in FY 2013-14, but, their accountant wrongly submitted TDS return u/s 194J instead of section 194I due to a clerical

M/S Western India Ceramics P. Ltd., Baroda vs. The Dy. Commr. Income Tax, Cen. Cir.-1, Rajkot-Gujarat

In the result, ground number 4 of the assessee’s appeal is dismissed

ITA 14/RJT/2017[2010-11]Status: DisposedITAT Rajkot03 Mar 2023AY 2010-11

Bench: Shri Waseem Ahmed (Accountant Member), Shri Siddhartha Nautiyal (Judicial Member)

For Appellant: Shri D.M. Rindani, A.RFor Respondent: Shri B.D. Gupta, Sr. D.R

Section 234ASection 250Section 271(1)(c)Section 40

ground of appeal are that assessee claimed rent expenses of " 52,42,183/- and the AO discovered that the assessee had not deducted TDS on rent amounting to " 19,07,213/-. Accordingly, this amount of " 19,07,213/- was added back to the income of the assessee ... Further, the AO also disallowed a sum of " 236,900/-on account of short deduction of TDS on rent. In appeal before Ld. CIT(Appeals), the assessee furnished a chart containing details of Rent and TDS deducted thereon and submitted that TDS was not deducted on rent only in cases

Pvr Ltd., New Delhi vs. ACIT, Circle-76(1), New Delhi

In the result, the appeals of the assessee are allowed for statistical purpose

ITA 202/DEL/2020[2012-13]Status: DisposedITAT Delhi09 Feb 2023AY 2012-13

Bench: Dr. B. R. R. Kumarsh. Yogesh Kumar Us

For Appellant: Sh. G. C. Srivastava, Sr. CounselFor Respondent: Sh. Sanjay Nargas, Sr. DR

Section 194Section 194CSection 194ISection 201

202/Del/2020 PVR Ltd. providers or developer/ owner, constitute approximately the same percentage of rent.” 4. The similar issue involving deduction of TDS on rent and CAM charges stands adjudicated by the order of the Tribunal in the case of Yum Restaurants India (P.) Ltd. in ITA No. 1115/Del/2020 ... sake of ready reference and completeness, the ratio of the said case is reproduced as under: “3. The provisions of TDS on rent are governed by Section 194I and maintenance contract are governed by Section 194C of the Income Tax Act, 1961. In this backdrop of the provisions

Pvr Ltd., New Delhi vs. ACIT Circle-76(1), New Delhi

In the result, the appeals of the assessee are allowed for statistical purpose

ITA 7290/DEL/2019[2011-12]Status: DisposedITAT Delhi09 Feb 2023AY 2011-12

Bench: Dr. B. R. R. Kumarsh. Yogesh Kumar Us

For Appellant: Sh. G. C. Srivastava, Sr. CounselFor Respondent: Sh. Sanjay Nargas, Sr. DR

Section 194Section 194CSection 194ISection 201

Rizwan Rehhan Malik, Mumbai vs. ITO 26(2)(5), Mumbai

In the result, the appeal filed by the assessee is partly allowed

ITA 2816/MUM/2017[2009-10]Status: DisposedITAT Mumbai10 Aug 2022AY 2009-10

Bench: Shri Pavan Kumar Gadale & Shri Amarjit Singhrizwan Rehan Malik Vs. Ito – 26(2)(5) 18, Friends Housing Mumbai. Society, Lbs Marg, Sakinaka, Mumbai –400072 Pan/Gir No. : Amqpm7948D Appellant .. Respondent Appellant By : None Respondent By : Smt. Mahita Nair.Dr Date Of Hearing 01.08.2022 Date Of Pronouncement 08.08.2022 आदेश / O R D E R Per Pavan Kumar Gadale Jm: The Assessee Has Filed The Appeal Against The Order Of The Commissioner Of Income Tax (Appeals) – 38, Mumbai Passed U/S 143(3) R.W.S 147 R.W.S 263 & 250. The Assessee Has Raised The Following Grounds Of Appeal:

For Appellant: NoneFor Respondent: Smt. Mahita Nair.DR

Section 143(3)Section 147Section 271Section 271(1)(C)Section 271(1)(c)Section 40

aside. 2. To restrict disallowance of Sec. 40 (a) (ia) to Rs. 4,30,587/- on account of non deduction of TDS on rent paid as explained above. 3. To delete wrongful addition of Rs. 5,00,000/- on account of unexplained cash expenses (Rent Paid) as explained above

Lifestyle International Private Limited, Bengaluru vs. Assistant Commissioner of Income Tax, TDS Circle-2(1), Bengaluru

In the result, appeal of the assessee is allowed

ITA 56/BANG/2022[2018-19]Status: DisposedITAT Bangalore29 Apr 2022AY 2018-19

Bench: Shri George George K & Ms. Padmavathy Sassessment Year : 2018-19

For Appellant: Smt. Tanmayee Rajkumar, AdvocateFor Respondent: Shri. Priyadarshini Besaganni, Addl.CIT DR

Section 133ASection 194Section 194CSection 194ISection 201Section 201(1)

assessee. During the survey the AO observed that the assessee has taken many properties on lease and the assessee has been deducting TDS on rent payments u/s. 194I of the Act. The AO also noticed that the common area maintenance charges (CAM charges) paid on these leased properties is treated

Lifestyle International Private Limited, Bengaluru vs. Assistant Commissioner of Income Tax, TDS Circle-2(1), Bangalore

In the result, appeals of the assessee are allowed

ITA 400/BANG/2021[2013-14]Status: DisposedITAT Bangalore26 Apr 2022AY 2013-14

Bench: Shri N V Vasudevan & Ms. Padmavathy S

For Appellant: Shri. T Suryanarayana, Sr. AdvocateFor Respondent: Shri. Priyadarshini Mishra, Addl.CIT DR

Section 194Section 194CSection 194ISection 201Section 201(3)

Bhushan Logistics Pvt Ltd., Mumbai vs. ITO Ward 15(1)(3), Mumbai

In the result, appeal by the assessee is partly allowed for statistical purpose

ITA 2480/MUM/2019[2014-15]Status: DisposedITAT Mumbai08 Apr 2022AY 2014-15

Bench: Shri Sandeep Singh Karhail & Shri Gagan Goyal

For Appellant: Shri Kishor PhadkeFor Respondent: Shri Chandra Vijay, CIT-DR

Section 143(3)Section 201Section 250Section 40

Pandharinath Mali and Rs. 1,50,000 to Mrs. Pratiksha Mali and thus there is no basis for not deducting the TDS on rent paid. Accordingly, the Assessing Officer disallowed the rent paid amounting to Rs. 3,02,000 under section