TDS on telephone Bills

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This query is : Resolved

Shrinaath Paravasthu (Querist)

21 January 2011 Hi ,

I would like to Know whether provisions of TDS will be applicable to Payments made to Reliance for Data Card charges .

Reliance bills explictly mentions charges as Monthly rentals . More over Reliance remains the owner of the data card , in the sense that it can stop / block a particular card whenever the situation arises.So the user is just availing the services while reliance still remains the owner . RIL also charges Service Tax on its bills

Will the tenats of section 194 I be applicable to the above said payments assuming that the annual payments exceeds the basic limit of Rs 1.80 Lakhs

CMA. Subhash Kumar Jha

CMA. Subhash Kumar Jha (Expert)

21 January 2011 TDS is not applicable on services using technology -- telephone charges, Internet charges, cable TV, leased lines.
Payments for use of standard facilities by the public at large in which some form of technical service is inherent are not covered under section 194J.
Please refer a case law : Skycell Communications Ltd. v. Deputy CIT[2001] 251 ITR 53 (Madras.).

Shrinaath Paravasthu

Shrinaath Paravasthu (Querist)

21 January 2011 The above said judgement mentions TDS under 194 J is not applicable .My doubt is whether Section 194 I (under equipments) is applicable for these transaction keeping in mind the Reliance & other operators are owners of the service and users are paying rent (as mentioned in bills) for availing these services.

Guest

Guest (Expert)

21 January 2011 in our opinion , data card is not an equipment for the purpose of Sec. 194I

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