So, if you don't pay the resident's rent on TDS, will you
get a full deduction or will you get a partial deduction?
We will talk about this in a few minutes.
For example, there is a business where a lot of
consultants' expenses are incurred.
I have to pay the contractors.
For example, I have hired an auditor, a CA firm.
And I said that you will audit my books of accounts.
He said, okay, I will do it.
How much will you charge?
I will charge Rs. 1 lakh.
Okay, I will pay.
Now, when I will pay it, according to the Income Tax Act,
according to the provisions of TDS,
I have to pay only Rs. 1 lakh.
Ideally, I should have paid Rs. 90,000.
And I should have deposited Rs. 10,000 on behalf of that
person in the Income Tax Department.
I will say that Rs. 10,000 is the tax of that person which
I am paying.
I am paying Rs. 1 lakh.
And TDS has deducted Rs. 10,000.
And the payment is going to that person for Rs. 90,000.
And it is not going to my house.
It is going to the government as an income tax.
Okay.
I had to deduct it.
I did not deduct it.
Not deducted.
I had to deduct it, but I did not deduct it.
Or else, I deducted it, but I did not deposit it in the
government's account.
Till the due date of ROI.
Till the due date of return, I did not deposit it in the
government's account.
I did not deposit the income tax of that person till the
due date of return.
Now, what will happen?
Because this person is a resident in this case.
The main thing and the main difference in the last section
and this section is that
Shakira and Chris Gill were non-residents.
The provision and everything is the same.
But in this case, he is a resident.
So, in this case, the government says that if you make such
a payment on which TDS is applied.
There is a scissor called TDS.
But you did not deduct TDS.
Or you deducted it.
But you did not deposit it till the due date of return.
So, in that case, 30%.
The expense of 30% will be disallowed.
What will be done?
Allow or disallow?
The expense of 30% will be disallowed.
For example, there is an expense of Rs. 1 lakh.
So, out of the expense of Rs. 1 lakh, Rs. 30,000 will be
disallowed.
And the expense that you will deposit in your P&L,
Legally, according to the income tax, you will have to
deposit Rs. 70,000.
Sir, we make books of accounts.
So, what to do in that?
The way you make books of accounts, according to the
accounting,
You will deposit Rs. 1 lakh.
Because the poor accountant does not know whether it will
be allowed or disallowed.
You will tell him.
For example, you do not have the information of the Income
Tax Act.
The accountant who is making your books of accounts,
He will deposit Rs.
1 lakh as soon as he gets the payment,
Signed the voucher etc.
There will be a bill.
He will deposit Rs. 1 lakh in his books of accounts.
Expense.
Okay.
No problem so far.
No problem.
I got the expense of Rs. 1 lakh.
From that, my profit will be reduced by Rs. 1 lakh.
Now, when the Income Tax Department will assess me,
Or when I will file my return etc.
At that time, my auditor,
My CA will tell me that,
Rs. 1 lakh that you have deposited,
Did you deduct TDS on it?
You will say, no.
Then he will ask you,
It is not that you have deducted TDS,
But you were not able to deposit it till the due date.
Of the return filing.
You will say, no, it did not happen.
So, what will happen in that case?
Rs. 1 lakh will be allowed only for Rs. 30,000.
Rs. 30,000 will be disallowed.
30% will be disallowed.
Rs. 70,000 will be allowed.
30% will be disallowed in that case.
The P&L account that you will make,
For example, you made P&L,
And you had deposited Rs.
1 lakh,
Now, you will be able to deposit only Rs. 70,000.
Sir, I had deposited Rs.
1 lakh,
Now, what should I do?
Because he was an accountant,
He did not know,
But he deposited Rs. 1 lakh.
Now, what should I do?
What did the government tell him?
The same thing that we are doing,
The profit that you had made,
Net profit,
I had told you to make some adjustments,
So, first, make it Rs. 1 lakh.
Remove that entire expense.
Which you have done.
Add it back.
You have done it.
And now,
How much do you have to deduct?
Rs. 70,000.
This will be its effect.
See if there is any problem.
Doctor, please show it here.
This is it.
In net profit,
Add that expense back.
This will increase your profit.
And how much do you have to deduct?
Rs. 70,000.
You will have to deduct Rs. 70,000 in that case.
This is the point, friends.
Is the point clear?
The same thing works in this too.
Sir, does the same thing work in this too?
In 40A,
The previous one,
I was telling you that,
Suppose, Shakira was very talented,
And she herself went and deposited the tax.
Yes, of course.
For example,
The person to whom you paid Rs.
1 lakh,
And you did not deduct the DDS,
What did that person do?
He showed that Rs. 1 lakh in his income.
He also filed the return.
And the tax that was made on it,
On Rs.
1 lakh,
He himself,
With his own pocket,
Deposited it in the government's account.
What does the government mean?
Tax.
Whether, The person to whom you paid the tax,
Deposits the tax,
Whether the person receiving the tax,
Deposits the tax,
Whether I am depositing the tax,
Or the person to whom I am paying the tax,
Deposits the tax.
It is the same thing.
The government should be the one to deposit the tax.
It has already deposited the tax.
I was incapable of depositing the tax.
I did not deduct the DDS.
But the other party,
To whom I paid the tax,
Deposited the tax.
So, Should I get the deduction?
The 30% that you disallowed,
Should I get the deduction?
Now, the government has received the tax.
Earlier, the government did not receive the tax.
Now, the government has received the tax.
So, should I get the deduction?
Tell me, friends,
Should I get the deduction?
The answer is,
Yes.
If the government receives the tax,
The other party,
Deposits the tax on the money,
Shows the income in return,
Files the return,
Then it will be assumed,
That I deducted the DDS.
When did I deduct the DDS?
On which date did I deduct the DDS?
When the person has filed the return.
This is the point, friends.
This is the point.
It could have also happened, sir,
For example,
Before filing the return,
You would have woken up,
And the next year,
You would have deposited the tax.
The DDS that had to be deducted,
Could have been done the next year.
Yes, it could have been done.
What I am saying is,
I did not deduct the tax.
But, for example,
I deducted the tax later,
In the subsequent year,
I deducted the tax.
The year I deduct the tax,
That year,
I will get the deduction.
I deducted the tax,
And did not pay it.
Later, I remembered,
That it was like this too.
So, the next year,
I made a payment for it.
So, the year I pay,
That year, I will get the deduction.
In the government's account,
The year the TDS amount reaches,
That year,
You will get the deduction.
It is a simple point, friends.
Is there any problem with this?
Come, take a look at this.
What does it say?
This is the section, 40A, IA.
As I have put it as images,
If you make a payment to a CA,
Or to a lawyer,
This is it,
Blind law,
You make a payment to the blind law,
And forget to deduct the TDS,
Then what will happen? 30% shall be disallowed.
If tax has not been deducted,
Or, You deducted the tax,
But did not pay due date of,
139.1.
Due date of 139.1 means,
Till the date of written filing.
Okay?
And then it says,
The question you had later,
It is covered here, friends.
If in respect of satsam,
Tax has been deducted,
In any subsequent year,
Or, Has been deducted,
During the previous year,
But paid after the due date,
30% shall be allowed as deduction,
In computing the income,
Of the previous year,
In which tax has been paid.
And if,
The one who got 1 lakh,
Did not go and deposit,
Then what will happen?
It would be deemed that,
SSE has deducted,
And paid the tax on such sum.
And the date of TDS,
What will be considered?
Date of deduction,
And payment of tax,
By the previous year.
What will be considered?
Date of deduction,
And payment of tax,
By the payer.
Means, The one who was paying,
Shall be deemed to be the date,
On which return,
Has been furnished,
By the payer.
This is a simple point, friends.
This is the point, friends.
Look at an example.
Tax, On royalty,
Paid to Mr.
A resident,
Has been deducted,
During previous year, 22-23.
Same has to be paid by, 31 July 23.
The date of written filing,
Till that date,
You have to deposit,
By the payer.
The payer,
Has paid royalty,
To a resident.
Due date,
Till the date of written filing,
Till that year,
You have to deposit TDS.
Otherwise, 30% disallowed.
Otherwise, 30% of the royalty paid would be disallowed.
If, in respect of such royalty, tax deducted has been paid
after written filing date.
30% would be allowed as deduction in the year of payment.
The year the money reaches the government, you will get the
deduction.
The government says that you should make the payment and
take the deduction.
It's a simple point.
Is the point clear?
Let's move ahead.
Sir, we have to fight.
We have to fight.
Who did we fight with?
What happened?
Sir, life is getting very difficult.
Concepts are a little heavy.
I am not able to sit with that much understanding.
I can understand what you are saying.
But will we remember these concepts for the rest of our
lives?
Friends, you will have to keep trying again and again.
You will have to practice again and again.
You will have to revise the concepts again and again.
Don't read the text again and again.
Watch the videos.
If you read the text, you may miss out on something.
If you watch the video, I am explaining the concept.
If you understand the concept, you will be able to do it
practically.
The main thing is that you should know the concept.
No one is asking you about the language.
You don't have to write the language.
Do you want the concept?
You will get the concept by watching the video.
Don't take tension. You take a lot of tension.
When I say that the brother has come, he will do everything.
Why do you take tension? I guarantee you.
Sir, in the battle of life, you are Lord Krishna, you are
Arjun, you are Bheem.
Now you have to become your own charioteer and take your
chariot out of the battlefield.
You have to win this battle.
No one will support you.
You may think that you have friends.
No one will support you.
You are the charioteer of your own chariot.
May God bless you.
You will go far, but you have to work hard yourself.
There is no work in life.
Work hard yourself, get up yourself, understand the
concepts yourself, and move ahead in life.
What else is there?
You are the charioteer of your own chariot.
How do you win your chariot from this battlefield?
Only time will tell.
Sir, you have said a great thing.
You have to say it.
If someone guides you at this time, the direction of your
life changes.
And they don't do it.
Come to the next point.
Expenses or payment not deductible in certain circumstances.
Let's try to understand this through an example.
For example, this is the point to understand.
Sir, what do we discuss in PGVP head?
We discuss expenses.
Will I get the expenses or not?
If I get the expenses, what is the benefit? Of the
businessman.
Why? Profit is less.
But if I don't get the expenses, it is a loss for me.
Now, friends, what happens generally?
For example, this is a P&L account.
My gross profit is here.
And let's say this is of 1 crore.
Okay? No businessman likes to pay taxes.
This is a lot of money.
How can I pay taxes like this? No one likes it.
What will he try to do?
To claim as much expenses as possible.
Generally, friends, what happens in business?
The owner tries to show as much expenses as possible.
What does he do?
Now, I have taken all the expenses.
I have taken all the incentives.
I have taken the salaries.
I have taken petrol and diesel expenses.
I have taken stationery expenses.
I have taken postage expenses.
Profit is still left.
What should I do now?
Okay, I will do one thing.
My madam, madam, madam, madam.
What is this?
Madam.
I have given the salary of madam.
This madam is nothing.
This is the third fail of madam.
She is the wife of the director.
This is the third fail.
She could not even pass the third class.
Sir used to say that there is a second pass.
You are saying the third fail.
It seems that she has studied till the third class.
That is why he says the third fail.
Okay.
So, this is madam.
This is the third fail.
This is the third class fail.
Now, she has a profit of one crore rupees.
Now, what should she do?
Should I finish the profit completely?
Should I get equal marks?
What did she do?
She gave the salary of madam.
One crore rupees.
And my dear, her net profit is zero.
So, will there be any tax on this?
When the net profit is zero.
Will there be any tax on this?
No, there will not be any tax.
This person has escaped.
He has escaped, sir.
Sir, she gave the salary of one crore rupees to the third
fail.
Is there any rate of salary of one crore rupees to the
third fail in the market?
Leave India.
Can't you get the salary of one crore rupees to the third
fail in America?
Try to understand the second point.
What else did she do?
If he would not have done this, what else could he have
done?
He bought some things from his brother.
For example, his brother was a garment salesman.
So, he bought some shirts from his brother.
The total value of the things was eight lakh rupees.
Eight lakh rupees.
The total value of the things was eight lakh rupees.
What did he say?
Do one thing.
The value is eight lakh rupees and I want the expenses.
So, I will do one thing.
My purchases will come as purchases.
What will I do with the purchases?
Instead of eight lakh rupees, I will show it as eighty lakh
rupees.
Eighty lakh rupees.
What will be the difference?
The gross profit of one crore rupees will be reduced.
The gross profit of one crore rupees will be twenty lakh
rupees.
Assume that all the expenses are there and my net profit
will be twenty lakh rupees.
Are you understanding?
The gross profit of one crore rupees will be twenty lakh
rupees.
The net profit of one crore rupees will be twenty lakh
rupees.
In this case, the salary that I gave to my wife for the
third time was zero.
I tied up with my acquaintances.
I told them that I am giving you a payment.
Here is the cheque.
I paid with the cheque.
I got the proof.
I will show the cheque to the government that I have paid.
I will pay them.
What will I do with them?
I will get some money deducted and spend it in cash.
I will tell them that I got eighty lakh rupees.
I got eighty lakh rupees.
Do one thing.
Give me seventy five lakh rupees out of eighty lakh rupees.
In cash.
What happened to this person?
He got seventy five lakh rupees in cash.
I gave him a cheque of eighty lakh rupees.
He got seventy five lakh rupees in cash.
He got five lakh rupees deducted.
But what would have happened if he had come to pay the tax
originally?
What would have happened to the tax on one crore rupees as
per thirty percent?
Thirty lakh rupees.
He would have paid thirty lakh rupees there.
He paid five lakh rupees here and got free.
Would everyone do this kind of provision?
He would catch people from around.
He would show them that he had bought the stuff worth eight
lakh rupees in eight crore rupees.
He would catch his family members.
He would catch his servants.
How much did you get?
Five thousand rupees per month.
You will get fifty thousand rupees per month.
I am giving you a cheque deducted.
I will give you the money in cash.
driver will give salary of 10 lakhs per month, we have to
put expenses, we have to put expenses, he will keep putting
expenses, if this provision is not there, he will keep
putting expenses, now he is putting expenses, Modi ji saw
him and said, friends come to Kopcha, do you understand
Kopcha, and Modi ji took him to Kopcha and said, son tell
me one thing, I too used to be a tea businessman, and I too
used to do tea business, all these things, what are they,
how are they, how do they work, and how they don't work, I
know everything, I am a Gujarati man, on top of that I have
been a businessman before that, payment of 8 lakhs, how did
it become 8 lakhs, how did the third file get 1 crore
rupees, brother it is like this, the excessive payment you
are doing, what are you doing,
payment you are doing,
the fair market value of that thing is 8 lakhs rupees, and
you are making 80 lakhs rupees, how much is excessive, 72
lakhs rupees, so this excessive, 72 lakhs rupees, this will
be disallowed, the excessive of 72 lakhs rupees, this will
be disallowed, okay, your profit in that case, how much did
you get, 20 lakhs rupees, for example, this was your sale
bill, and your gross profit, and your purchase, you had put
some purchase of 80 lakhs rupees, and because of this your
gross profit came out,
gross profit came out of 20 lakhs rupees, in this case this
was excessive, originally it should have been 8 lakhs
rupees, you paid that person for 80 lakhs rupees, and lost
the cash, so brother this 72 lakhs rupees, this will again,
your net profit will come out, for example, net profit came
out of 15 lakhs rupees, after putting more expenses, so in
this again you will do that excessive add, your 72 lakhs
rupees will be added, and your net profit will come out.
So, your net profit will be considered as 87 lakh rupees.
And you will have to pay income tax as well.
More than 87 lakh rupees, my dear.
If you pay above the fair market value, you are paying
specified persons.
This payment is not being made in the normal course of
business.
In other sources, there is a discussion about this.
If you give more money to your relatives, wife, spouse,
children, etc.
For example, in this case, if his wife did not fail the 3rd
grade, for example, she would have been an IIT engineer.
She would have done IIM.
She would have had exposure of 20-25 years.
She would have been useful.
And then she would have given a salary of 1 crore rupees.
Then she would have got the deduction.
We are allowing excessive disallowance.
If we pay her according to her capability, then it is
allowed.
If she fails the 3rd grade, we pay her 5,000 rupees per
month.
It is allowed.
Pay according to her capability.
What is the fair market value?
If you pay more than the fair market value, then
disallowance will be done.
If you pay according to her capability, then it is allowed.
Keep this point in mind.
What is written here?
So much of the expense as is considered to be excessive.
If it is excessive or unreasonable, it will be disallowed.
It will be added to your profit.
You will not be able to take its deduction.
Who is the individual? Relative.
Or someone has a substantial interest in your company.
He has more than 20% voting power in your company.
Or if you have a firm with more than 20% profit share, in
that case, it will be accepted that he will fall in the
category of specified person. He has given a list of
specified persons.
You can read it easily.
He told us the meaning of substantial interest.
This was the point, friends.
You can see it here.