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Tds (Income Tax)

This query is : Resolved

Aarti

( Author )
17 August 2012

Dear Sir,

I have a small Doubt in deduction of the tds

Whether TDS is to be deducted on a contractual payments for example a contract with a telephone company for a fix amount for providing telephone or lease line ??? Bill received from a telephone company which is base amount + service Tax @ 12.36% on it.

It is a contract with a company for a specific work for specific amount. Service tax is charged on a bill by a telephone company as he is acting as a service provider.

What about the TDS in such case ???

Nischit Sanghavi

( Expert )
17 August 2012

As it is a case of contract, TDS is require to deduct @2% on net amount i.e.including Service Tax.

Aarti

( Author )
17 August 2012

Thanks for your reply.

Can you give me some notification or section which states this ???

I am facing a problem with a telephone company. They are not accepting the TDS deduction and the deducted amount is getting add back to my next bill.

As per telephone lease line service provider this TDS deduction is exempt by low.

Nischit Sanghavi

( Expert )
17 August 2012

Leased line means Internet Leased line?

Nischit Sanghavi

( Expert )
17 August 2012

There is no need to deduct the TDS for Internet. It has also been held in case of Skycell Communication Ltd.v.Deputy CIT(2001)251 ITR 53 (Mad).

Nischit Sanghavi

( Expert )
17 August 2012

R u satisfied from this reply?

Aarti

( Author )
17 August 2012

Yes !!! Leased Line is Internet Leased line as well as telephone - that is Land line.
So no need to deduct a TDS ???