Applicability of TDS
This query is : Open
18 May 2011
Hello frnds... Kindly provide ur valuable suggestions the issue!!
The brief facts are:
The company is in the business of Hybrid Seeds. The production of hybrid seeds is done from foundation seeds supplied by the company. The production is given to various organisers who are basically like a middleman/ Team Leader with a group of Farmers in an area under him.
Company deals mainly with the organizers only. The company supplies foundation seeds to the organizers with agreement to supply the hybrid seeds as per the quality parameters of the company. The production taken by the organizers with various farmers is continuously monitered by the company's production team. Advances are also given in some of the crops from time to time on achieving certain milestones set out, this amount is debited to the account of organizers.
The foundation seeds supplied to organizer is billed to him by debit to his account and shown as sales in P&L account. The company pays consolidated price per kg to the organizers towarsd procurement of of quantity that has passed the quality parameters of the company, which is credited to the account of the organizers.
Question
1. Whther as per the amended sec 194c, the supply of hybrid seeds as per the requirement of the company by the organizersusing material of the company is liable to TDS provisions?
2. If yes then at wat amount, if organizer gives invoice by splitting the amount into seed cost and his contactor's remuneration or service charges or commission on purchase?
Kindly guide on the same.
The brief facts are:
The company is in the business of Hybrid Seeds. The production of hybrid seeds is done from foundation seeds supplied by the company. The production is given to various organisers who are basically like a middleman/ Team Leader with a group of Farmers in an area under him.
Company deals mainly with the organizers only. The company supplies foundation seeds to the organizers with agreement to supply the hybrid seeds as per the quality parameters of the company. The production taken by the organizers with various farmers is continuously monitered by the company's production team. Advances are also given in some of the crops from time to time on achieving certain milestones set out, this amount is debited to the account of organizers.
The foundation seeds supplied to organizer is billed to him by debit to his account and shown as sales in P&L account. The company pays consolidated price per kg to the organizers towarsd procurement of of quantity that has passed the quality parameters of the company, which is credited to the account of the organizers.
Question
1. Whther as per the amended sec 194c, the supply of hybrid seeds as per the requirement of the company by the organizersusing material of the company is liable to TDS provisions?
2. If yes then at wat amount, if organizer gives invoice by splitting the amount into seed cost and his contactor's remuneration or service charges or commission on purchase?
Kindly guide on the same.
18 May 2011
http://taxguru.in/income-tax-case-laws/income-from-cultivation-of-parent-hybrid-seed-is-non-agricultural-income-and-taxable-as-business-income.html
19 May 2011
Thanx for ur valuable input.... But the purpose of askin the question is to knw about the applicability of TDS in this case, not the classification between business or agricultural income...
Kindly guide me regarding the same!!
Kindly guide me regarding the same!!
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