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TDS on Cash back

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(Querist)
19 September 2020 Hi Experts,
Need some guidance on the below topic:
"A" provides service to "B" and raise an Invoice for the service provided. At the end of the year, based on the volume of business, "A" needs to pay back 5% of the total Sales amount to "B". This is something which they termed as cash back in commercial parlance.
E.g. If total sales during the year is Rs.1,00,000, then at the end of the year A has to pay Rs.5000 to B as cash back amount for the business given by B to A.
The question here is, whether the cash back amount is subject to TDS? If yes, will it attract TDS u/s 194H?
Please suggest.
Thank you!
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CA PARTH SHAH

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CA PARTH SHAH (Expert)
20 September 2020 According to us, this is sort of discount given to the customer based on the sales made by them. So it should not be liable for TDS on commission under section 194H
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Gouri Sankar Tripathy

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Gouri Sankar Tripathy (Querist)
22 September 2020 Appreciate the feedback Parth Ji.
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