TDS

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Nikhilesh

Nikhilesh (Querist)
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08 May 2010 Whether tds applicable on commission/brokerage payable on IPO(initial public offer)

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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08 May 2010 U/s.194H rate 10%

CMA. CS. Sanjay Gupta

CMA. CS. Sanjay Gupta (Expert)
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08 May 2010 AGREE

Shyam Lal Naik

Shyam Lal Naik (Expert)
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08 May 2010 I have a dobut.

Section 194H is not applicable to services in relation to transaction relating to securities in terms of explanation (i) to Section 194H.

It appears that the transaction in question is out of TDS net.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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08 May 2010 Ofcourse Mr.Naik. But the explanation (1) is not so wide, under that explanation the element of Agency is not there then the TDS u/s.194H will not apply i.e.incase tranasactions principal to principal basis even commission paid that commission not covered under 194H

Nikhilesh

Nikhilesh (Querist)
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08 May 2010 Sir i have a doubt on your conversation.
This is share broking company. company paying brokerage/commission to their dealers on IPO.

Hence can u explain exact applicability and princpal to princpal explanation. I aslo read explanation 1 of 194H. i have adoubt on that aslo.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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08 May 2010 Principal to principal basis means the Property of goods transfer to particular person for selling and that person selling the goods and getting the commission on that sales in this case Sec.194H is not applicable

But Agency element is the property or right of the goods not transfer still with the principal, but a person act as agent for selling that goods and getting commission in that case sec.194H applicable

Nikhilesh

Nikhilesh (Querist)
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08 May 2010 Thank u sir.

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