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Tds deduction on interest on 

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term loan from bank
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 23 December 2014
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Sir please tell me whether tds will be
applicable on Interest payable on term loan
 PURCHASES/ SALES OF
from bank ?
AMOUNT MORE THAN
sushil 10000/ 2LACS
I have booked for interest payable on term loan
upadhyay but tds not deducted , is it correct entry ?
 Fixed Deposits with Banks
(Querist)  Display of gst registration
certificate
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 Cashreceipt
 E INVOICE applicability to
 23 December 2014
GTA
Yes correct entry. Interest on loan is covered to
 TDS on sale of immovable
TDS u/s 194A of the Income tax Act. However,
property co-owned by a
as per Sec.194A(3)(iii), interest paid to any
resident and a non-resident
banking company to which Banking Regulation
CMA. CS.  Bill Issue with GST rate and
Act, 1949 applies is not subject to tax
Sanjay Gupta with RCM
deduction.
(Expert)  ADDITIONAL PLACE OF
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BUSINESS (GODOWN TO
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STORE GOODS ONLY)
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 24 December 2014
 Is it advisable to charge
Dear Mr. Sanjay Gupta your treatment is correct interest on the Cash and
but you are misquoting the section 194A. Receivables available on the
Section 194A belongs to TDS on interest Books ?
otherthan Interest on Security which is paid to
CA Kumar resident.
Mukesh
(Expert) In present case Resident (Assume) paid
+ Follow interest to Banking Company.

Therefore, correct section is 196

 24 December 2014

Dear Mr. Kumar Mukesh please read Section

194A(3)(iii) & Section 196 both and then say
who needs to be corrected.
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CMA. CS.
Sanjay Gupta
(Expert)

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 29 December 2014

My view is the more relvent section is sec.194A

only. Section 194A is considering Interest
paying to resident ( Resident may be Banking
company also)and sec.194A also have specific
CMA Ramesh clause of interest payment to banking company
Krishnan exempted from TDS deduction.
(Expert)

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 29 December 2014

Section 194A
Any person, not being an individual or a Hindu
undivided family, who is responsible for paying
TRENDING ONLINE
to a resident any income by way of interest CLASSES
CA Kumar other than income 44[by way of interest on
Mukesh securities], shall, at the time of credit of such GST Practitioner
(Expert) income to the account of the payee45 or at the Certificate Course
+ Follow time of payment thereof in cash or by issue of a 36th Batch
cheque or draft or by any other mode,
CA Arun Enroll Now
whichever is earlier, deduct income-tax thereon
Chhajer
at the rates in force :
(a) ten thousand rupees, where the payer is a How to Earn Money
banking company to which the Banking from CHAT GPT
Regulation Act, 1949 (10 of 1949) applies
CA Enroll Now
(including any bank or banking institution,
Deepak
referred to in section 51 of that Act);
Gupta

3 Days Course on In-

Analysis: Section, 194A is related when depth Analysis of ITR
payment MADE BY BANKING Company 3, ITR 5 and ITR 6
whereas section 196 is related with payment
Manoj Enroll Now
MADE TO BANKING Companies.
Lamba

 29 December 2014 VIEW ALL CLASSESS 

Dear Mr Kumar Mukesh you have made all the

analysis but the problem is that even after my
request you have not gone through Section
194A(3)(iii). Let me reproduce it below:
CMA. CS.
Sanjay Gupta 194A(3)(iii) The provisions of sub-section (1)
(Expert) Stay updated with latest
shall not apply to such income credited or paid
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Banking Regulation Act, 1949 (10 of 1949),
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applies, or any co-operative society engaged in
carrying on the business of banking (including a Subscribe
co-operative land mortgage bank).

It clearly shows that your analysis is not

correct. Exemption from deduction of TDS is Quick Links
granted vide provision contained in Section
194A(3)(iii). Experts Home

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 29 December 2014 Daily Digest

196. Notwithstanding anything contained in the

foregoing provisions of this Chapter, no Show all queries
deduction of tax shall be made by any person
from any sums payable to— Today's Posts
CMA. CS. (i) the Government, or
Sanjay Gupta (ii) the Reserve Bank of India, or Ask a Query
(Expert) (iii) a corporation established by or under a
+ Follow Central Act which is, under any law for the time Answer a Query
being in force, exempt from income-tax on its
income, or Hall of Fame
(iv) a Mutual Fund specified under clause (23D)
of section 10, Settings (Only for experts)
where such sum is payable to it by way of
interest or dividend in respect of any securities
or shares owned by it or in which it has full
beneficial interest, or any other income
accruing or arising to it.

Your Analysis says Section 196 is related to

payment made to banking companies. Please
read the section 196 which is produced herein
above and state which among (i) to (iv) will
include the banking companies. I hope you
don't refer to Reserve Bank of India.

Kumar Mukesh Ji do you still think your analysis

is correct?
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 30 December 2014

Dear Mr. Sanjay, you are rightly said that

section 194A is more specific than 196.

Thanks
CA Kumar
Mukesh
(Expert)

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 02 January 2015

In reply to the PM of Gupta Ji, I too endorse the

view that section 194A(3)(iii) applies to the
issue raised.

Bhaskaran
Chackrapani
Warrier
(Expert)

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