Chartered Accountant
105 Points
Joined March 2011
If the Payment is in the nature of Royalty, TDS needs to be deducted u/s 194J, if a single amount exceeds Rs. 30000/- or annual payment exceeds Rs. 100000/- otherwise if the payment is in nature of commission, TDS to be deducted u/s 194H. Whatever the case may be, TDS Rate will be 10% only. In no case, TDS can be deducted u/s 194C @ 2%.
Since, Section 194C states that any person responsible for paying any sum to resident contractor for carrying out any work.
The expression "work" in this section would include-
- advertising;
- broadcasting and telecasting including production of programs for such broadcasting or telecasting;
- carriage of goods and passengers by any mode of transportation, other than railways;
- catering;
- Manufacturing or supplying of a product according to the requirement or specification of a customer by using the materials purchased from such customer, But does not include manufacturing or supplying of a product according to the requirements or specifications of a customer by using the materials purchased from a person, other than such a customer.
Thus you may have to deduct TDS @ 10% only and mostly the payments are in the nature of Royalty and so liable u/s 194J