Liability to deduct TDS on rent

prasad (Querist) 22 February 2010 This query is : Resolved
My client is a partnership firm .It came into existence by an oral agreement on 1st july, 2009.The written agreement was executed on 1st of December, 2009.Now, the question is,whether for Income tax purposes when did the firm come into existence ?
This is relevant ,since they have not deducted TDs on rent. So was my client liable to deduct tax on rent for the period 1st July to 30th Nov? Or will they be treated as an AOP?

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Raj Kumar Makkad (Expert) 22 February 2010
Even if your cleint did not deduct TDS on rent since 1st Jul 09 to 30th Nov 09 even then they are liable to pay and oral partnership has also same status as of written.

Dr.Anjani Kumar Vaidyasen,09431271130,Patna (Expert) 22 February 2010
Dear Prasad,
Under the provision of Income Tax Act,only those persons can be able to deduct TDS from the rent who has obtained TAN from the Income Tax Department.
Second your firm will be treated as partner ship firm from !st Dec,2009. So that your liability for payment of tax will exist till date.
Thanks & regards.
Anjani Kumar Vaidyasen
akvaidyasen@gmail.com

prasad (Querist) 22 February 2010
sir, according to section 184 of the Income tax act for a firm to be assessed as a firm one of the conditions is that the partnership should be evidenced by an instrument. My query was based on this logic.

prasad (Querist) 22 February 2010
Dr Anjani Sir, I need some clarification from you.My client has obtained a TAN. Now, pls tell me whether they should deduct TDS from Dec onwards or from July 2009 onwards.

A V Vishal (Expert) 22 February 2010
If the partnership is with effect from July 2009 as evidenced in the recital of the deed then he needs to deduct it from that date else no.