: For Finance Professionals & Students

Monthly Archives: April 2014

First we should know who can become Karta and what is powers of Karta.The Karta is the manager of HUF and have wide powers by way of controlling the affairs of the HUF. The Karta enjoys his position in the HUF by operation of law without any agreement and consent of other members of HUF. He stands in a fiduciary relationship with other members, but he is not accountable to anyone.

Q.1. Whether assessee liable to deduct TDS u/s 193 on provision of interest in case payee is not identified.
Ans. Explanation to section 193 cannot be invoked in a case where person who is to receive interest cannot be identified at stage at which provision for ‘interest accrued but not due’ is made and therefore there was no obligation upon assessee to deduct tax at source, there could not be any question of levy of penalty and interest under section 201 upon assessee. Industrial Development Bank of India v. ITO [2007] 107 ITD 45 (ITAT- MUM.).

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