Tds on corporate guarantee fee paid to company

This query is : Resolved

Sathishkumar Ramamoorthy (Querist)
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02 April 2013 Dear All,

We have to pay Corporate Guarantee Fees to our Parent company towards they have provided bank guarantee on behalf of us. Please clarify whether TDS applicable for this transaction or not?

Regards
Sathish

CA. PIYUSH GOEL

CA. PIYUSH GOEL (Expert)
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02 April 2013 dear when a company say "A" is giving Guarantee to a bank in respect of another company say "B" . it clearly shows that it is a contract of surety b/w "A" and "B". because if company "B" makes default in making payment to the bank, "A" will have to make payment on its behalf..

therefore TDS should be deducted u/s 194C

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