Applicabilty of` tds on payment against court order

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

15 June 2017 Dear Experts,
FACT:
Our company had given a contract of housekeeping to a contractor. We used to deduct TDS @ 2% on every payment made to contractor. However, due to minimum wage rate revisions, the contractor didnt pay their labourers the revised rate. Later, the labourers filed the case against our company for payment of differential portion of wages. The court ordered that differential payment has to be done by our company (being principal employer).

QUESTION:
1) Whether TDS is applicable for the above payment which is to be done by our company directly to labourers?
2) If TDS is applicable, then under which section the TDS to be deducted i.e under 194C or Salary??

Thanks in advance!!!

Amol S Joglekar

Amol S Joglekar (Expert)
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16 June 2017 Only the mode of payment is ordered by the court. It has NOT rescinded any contract between your company and the labour contractor. So for your company it is still payment to contractor and TDS be done accordingly

Querist : Anonymous

Querist : Anonymous (Querist)

16 June 2017 Dear Shri Amol,

Thanks for your reply. But is there any provision by which our company can avoid TDS as payment is to be done against court order.

Amol S Joglekar

Amol S Joglekar (Expert)
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16 June 2017 either you can apply the court so to do OR apply to concerned ITO to allow you to deduct tax at lower rate or no rate

Querist : Anonymous

Querist : Anonymous (Querist)

16 June 2017 Dear Sir,

Is there any section/provision/ruling under Income Tax Act/ Case Law.

Amol S Joglekar

Amol S Joglekar (Expert)
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16 June 2017 Applying to the court : There is no section under income tax act.
Applying to ITO : Form no 13.
please refer following
http://www.thinklegal.co.in/viewexternalfile20092010/incometaxrulesform13652011.pdf

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