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Tds on printing of annual reports of company

Rajendra Prasad Nadella (Chief Financial Officer) (21 Points)

11 February 2017

Whether TDS is applicable on printing of annual reports and other stationery required to a manufacturing company? Any recent changes in this regard??

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2 Replies

Aalok (accountant) (50 Points)
Replied 11 February 2017

yes 2% applicable on basic amount if he have pan card

Sanjay S (Chartered Accountant) (1375 Points)
Replied 11 February 2017

The provisions of section 194-C had been amended on a major scale way back in 2009. Based on such amended provisions, my answer to the question would be as follows:

Scenario # 1: If Materials (Paper, etc) are NOT supplied by the company to the Printer

In this case, the contract does not get covered under the definition of the term "WORK" defined under explanation to section 194C as follows:

----> 'Work' for purpose of section 194-C shall include:

(a)..........................

(b), (c), (d).............

(e) manufacturing or supplying a product according to the requirement or specification of a customer by using material purchased from such customer,but does not include manufacturing or supplying a product according to the requirement or specification of a customer by using material purchased from a person, other than such customer.

Hence this means if materials required for printing (esp. paper, special materials, etc) are NOT supplied by the manufacturing company, then TDS u/s 194-C shall not apply on such printing charges, since it takes the nature of 'CONTRACT for SALE'.

Scenario # 2: If Materials (paper, etc) are SUPPLIED by Company to the Printer:

In this scenario, the work done by the printer gets squarely covered under the definition of 'WORK' (since its a manufacturing or supplying a product according to the requirement or specification of a customer by using material purchased from such customer) and hence TDS shall apply @ 1% or 2% as the case may be. Here, its a 'CONTRACT for SERVICE (Job Work)' for printing something on the customers' materials and hence TDS applies.