income tax -tds

This query is : Resolved 

22 April 2009

Our Company provided Sodexho Pass (Food Coupon)to our employees and we receive the bill which includes the amount of food coupon and service charges Suppose if we have ordered food coupon of Rs 10000/- on that the pass service agent charges service chgs of Rs 1000 + service tax chgs Rs 112.36 he provide us the bill for all these amount into one bill amounting to Rs 11,112.36/- my query is that should i have to deduct TDS on the whole amount i.e Rs 11,112.36/- or only on the service charges + service tax i.e Rs 1112.36/-


Shyam Lal Naik (Expert)
22 April 2009

To me, it appears that the transaction does not attract TDS. It does not amount to Contract for carrying out any work. Principal - Contractor relationship absent.

Regarding service charges, in addition to the abovbe ground, it could be said that all service charges are not contract for carrying our any work. The Hon'ble Supreme court recently held that, tds is not required to be deducted from various service rendered by hotels to customers. It observed that, if such services are liable to TDS, than, one need to deduct tds for geting hair cut.

However, please seek more opinion.

P.Gopinath (Expert)
22 April 2009

Tds need not be deducted becuase you purchase coupons for employees.We also used to purchase Sodexpass for emloyees in earlier years but we have not dedcuted so far.

CA Nitin Wadhwani (Expert)
22 April 2009

I think tax needs to be deducted and on 11112.36 since it is an implied contract.

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