Tax deduction at Source

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Narasimha (Querist)
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29 December 2008 Is TDS applicable on services rendered which are part of the main contract of purchase. and both the goods as well as the services are by the same party and in a single contact (but different invoice)
Eg. body building charges of buses. installation of machines

CA. Dashrath Maheshwari

CA. Dashrath Maheshwari (Expert)
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29 December 2008 Yes, TDS u/s 194C is applicable, it doesn't make any difference that:
1. Party is same from whom the machinery is purchased.
2. The service contract is part of main contract.

**DM

Narasimha

Narasimha (Querist)
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29 December 2008 hi Dashrath,

will your answer be the same if the property in the goods gets transferred to the buyer after the rendering of the services.

in the above example. if the agreement is like, purchase of buses after the body is built (as per contract terms) and the sale of buses and service charges are invoiced separately ?

CA. Dashrath Maheshwari

CA. Dashrath Maheshwari (Expert)
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29 December 2008 Yes, the answer will be same.
But if you purchase a bus (completed in all respect) and seller gives invoice for bus, and not separate for chassis and making charges, then in my opinion, service tax will not be applicable.

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