Failure to deduct TDS results in expenditure disallowance, interest liability and penalty for the deductor. Failure to deduct TDS or to deposit deducted tax results in disallowance of the related expenditure until tax is later deducted or deposited, treatment as an assessee-in-default attracting simple interest for the period from tax becoming deductible until deduction and from deduction until payment, and potential imposition of a penalty equal to the tax not deducted or paid.