TDS disallowance U/s 40(a)(ia)

[C ChiranjeeviRaj]

My client has constructed a building on contract basis and it is billed as construction service without bifurcation for materials. It is a fixed asset. TDS is not deducted. What is present position of law? Whether disallowance U/s 40(a)(ia) is applicable for this capital expenditure. If so how to be made.

[Ganeshan Kalyani]

You have time to deposit the TDS on or before the due date of filing return.

AI Summary

TDS on construction payments: deposit before return filing due date to avert disallowance under section 40(a)(ia). The payer who failed to deduct TDS on a contract-built fixed asset billed as construction service may cure non-deduction by depositing the outstanding TDS on or before the due date for filing the income-tax return, which is presented as the practical step to address potential disallowance under 40(a)(ia).