Tds on cfs charges
This query is : Resolved
17 February 2014
Our company is a clearing and forwarding agent. We received a bill from container freight station which had import handling charges, storage charges, energy surcharge,weighment charges and service tax.
Is TDS applicable on these payments and under which section?
Is TDS applicable on these payments and under which section?
27 July 2025
Got it! Here’s a clear explanation on **TDS on Container Freight Station (CFS) charges** for your case:
---
### Charges Received from Container Freight Station (CFS):
* **Import handling charges**
* **Storage charges**
* **Energy surcharge**
* **Weighment charges**
* **Service tax**
---
### Is TDS Applicable?
**Yes, TDS is applicable on certain components, but not on all.**
---
### How to Deduct TDS:
1. **TDS Section:**
* Most payments for **services** related to transportation, clearing, forwarding, handling, storage etc., are covered under **Section 194C (Payment to Contractors)**.
* If the charges are for services rendered by the CFS (like handling, storage, weighment), TDS under **Section 194C @1% or 2%** (depending on whether the party is individual/firm or company) applies.
2. **What About Service Tax?**
* **TDS is not deductible on the Service Tax component** of the bill because service tax is a government levy, not income of the CFS.
3. **Which Amount is Considered for TDS?**
* Deduct TDS on the **gross amount excluding Service Tax**.
* For example, if total bill is Rs. 1,00,000 and Service Tax is Rs. 12,000, TDS should be deducted on Rs. 88,000.
---
### Summary:
| Component | TDS Applicable? | Section |
| ----------------------- | --------------- | ------- |
| Import Handling Charges | Yes | 194C |
| Storage Charges | Yes | 194C |
| Energy Surcharge | Yes | 194C |
| Weighment Charges | Yes | 194C |
| Service Tax | No | N/A |
---
### Additional Notes:
* **If CFS is a company**, deduct TDS @ 2%.
* **If CFS is an individual/firm**, deduct TDS @ 1%.
* Ensure that you have the correct PAN of the CFS for proper TDS credit.
---
If you want, I can help you draft an email or TDS certificate format for your vendor. Need help with that?
---
### Charges Received from Container Freight Station (CFS):
* **Import handling charges**
* **Storage charges**
* **Energy surcharge**
* **Weighment charges**
* **Service tax**
---
### Is TDS Applicable?
**Yes, TDS is applicable on certain components, but not on all.**
---
### How to Deduct TDS:
1. **TDS Section:**
* Most payments for **services** related to transportation, clearing, forwarding, handling, storage etc., are covered under **Section 194C (Payment to Contractors)**.
* If the charges are for services rendered by the CFS (like handling, storage, weighment), TDS under **Section 194C @1% or 2%** (depending on whether the party is individual/firm or company) applies.
2. **What About Service Tax?**
* **TDS is not deductible on the Service Tax component** of the bill because service tax is a government levy, not income of the CFS.
3. **Which Amount is Considered for TDS?**
* Deduct TDS on the **gross amount excluding Service Tax**.
* For example, if total bill is Rs. 1,00,000 and Service Tax is Rs. 12,000, TDS should be deducted on Rs. 88,000.
---
### Summary:
| Component | TDS Applicable? | Section |
| ----------------------- | --------------- | ------- |
| Import Handling Charges | Yes | 194C |
| Storage Charges | Yes | 194C |
| Energy Surcharge | Yes | 194C |
| Weighment Charges | Yes | 194C |
| Service Tax | No | N/A |
---
### Additional Notes:
* **If CFS is a company**, deduct TDS @ 2%.
* **If CFS is an individual/firm**, deduct TDS @ 1%.
* Ensure that you have the correct PAN of the CFS for proper TDS credit.
---
If you want, I can help you draft an email or TDS certificate format for your vendor. Need help with that?
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