Does Section 40(a)(ia) cover cases of short deduction of TDS?

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....oes Section 40(a)(ia) cover cases of short deduction of TDS?<br> Query (Issue) Started By: - Ramanathan Seshan Dated:- 21-6-2025 Last Reply Date:- 24-6-2025 Income Tax<br>Got 2 Replies<br>Income Tax<br>Dear Experts, Since the proviso states that disallowance applies where "an assessee fails to deduct the whole or any part of the tax" under Chapter XVII-B, can short deduction be considered a failu....

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....re to deduct, thereby attracting disallowance under this section? Regards, S Ram Reply By Padmanathan KV: The Reply: It is a debatable issue. Calcutta High Court in 2012 (12) TMI 873 - CALCUTTA HIGH COURT and Delhi High Court in 2022 (7) TMI 748 - DELHI HIGH COURT has taken a view that disallowance under section 40(a)(ia) is not attracted on short-deduction. However, Kerala High Court in 2015 ....

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....(8) TMI 277 - KERLA HIGH COURT has taken a view that "tax deductible at source under Chapter XVII-B" occurring in the Section 40(a)(ia) has to be understood as tax deductible at source under the appropriate provision of Chapter XVII-B and hence, disallowance is attracted for short-deduction also. Reply By Ramanathan Seshan: The Reply: Dear Padmanathan-sir, Thank you for your detailed response. ....

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.... My question stems from the second proviso to Section 40(a)(ia), which clearly appears to cover cases of short deduction. However, the courts have generally not examined the provisos in depth. Moreover, as a general rule, the main section typically prevails over the provisos, doesnt it? Regards, S Ram<br> Discussion Forum - Knowledge Sharing ....