TDS on DG repacking

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manisha (Querist)
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06 October 2020 Dear Sir

We have export material to UK, against export we have recd TWO invoice from our Clearing & Forwarding Agent.
1 Bill for DG repacking including GST
2. Service bill with GST-

My Query whether we have to deduct tds u/s 94c on DG repacking Invoice or not

Please help me

manisha

manisha (Querist)
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06 October 2020 Dear Sir We have export material to UK, against export we have recd TWO invoice from our Clearing & Forwarding Agent. 1 Bill for DG repacking including GST 2. Service bill with GST- My Query whether we have to deduct tds u/s 94c on DG repacking Invoice or not Please help me

Read more at: https://www.caclubindia.com/experts/details.asp?mod_id=2810164

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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11 July 2024 In the scenario you've described, where you've received invoices from your Clearing & Forwarding Agent (CFA) for services related to export, let's address the TDS (Tax Deducted at Source) applicability under Section 194C of the Income Tax Act, 1961.

### Understanding Section 194C

Section 194C deals with payments made to contractors and subcontractors for any work, including services. It mandates the deduction of TDS when payments exceed specified limits. Here are the key points relevant to your query:

1. **Nature of Services**: The services provided by your CFA include DG (Dangerous Goods) repacking and other clearing and forwarding services.

2. **Applicability of TDS**: According to Section 194C, TDS is applicable on payments made for any work carried out by a contractor or subcontractor. This includes services provided by a CFA.

3. **Threshold Limits**: TDS under Section 194C is applicable if the aggregate payments to the contractor or subcontractor exceed Rs. 30,000 in a single payment or Rs. 1,00,000 in aggregate during the financial year. If these thresholds are exceeded, TDS should be deducted at the specified rates.

### Specific to DG Repacking Invoice

DG repacking services provided by your CFA fall under the category of services covered by Section 194C. Therefore, TDS would be applicable on the payment made for DG repacking if the payment exceeds the threshold limits mentioned above.

### Conclusion

Based on the information provided:
- **DG Repacking Invoice**: Yes, TDS under Section 194C would be applicable on the payment made for DG repacking services if the payment exceeds the specified threshold limits.

It's important to ensure compliance with TDS provisions and accurately calculate and deduct TDS at the applicable rates. If you have any doubts or require specific advice tailored to your situation, it is advisable to consult with a qualified tax professional or chartered accountant who can provide guidance based on the latest tax regulations and specific details of your transactions.

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