28 March 2015
The person(contractor) who is directly making the payment and with whom contract is entered in to is liable to deduct TDS on sub contractor.
(1) Any person responsible for paying any sum to any resident (hereafter in this section referred to as the contractor85) for carrying out any work85 (including supply of labour for carrying out any work) in pursuance of a contract between the contractor and a specified person shall, at the time of credit of such sum to the account of the contractor or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amount equal to—
(i) one per cent where the payment is being made or credit is being given to an individual or a Hindu undivided family;
(ii) two per cent where the payment is being made or credit is being given to a person other than an individual or a Hindu undivided family, of such sum as income-tax on income comprised therein.
Conclusion :-
TDS shall be deducted by contractor who is making payment for contract.
And now there is no concept of sub contractor in section 194C.(after amendment)
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