urgent clarification on tds u/s 194c

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kaviyarasan (Querist)

03 June 2010 Will tds attract incase of jobwork is done and bill raised with excise duty or any other duty, or is it exempt from deducting tds?

Ram Avtar Singh

Ram Avtar Singh (Expert)

03 June 2010 TDS applicable on job work, if excise charge by jobworker its not jobwork. its sale therefor no tds on sale/purchase

kaviyarasan

kaviyarasan (Querist)

04 June 2010 My client and also the jobworker says, that it was not purchase or sale, it's jobwork only, and the jobworker says since he is raising duty there is no provision for deducting TDS

kantijain

kantijain (Expert)

04 June 2010 Dear kaviyarasan,

TDS provision under the income tax act need to be reviewed independently. Just beacause some one is charging sales tax/excise duty and someone is not charging service tax is the not the ultimate factor to be considered.

since the transaction is that of job work the TDS u/s 194C is applicable irrespective of what other taxes are applicable. However on what amount is a question to be resolved based upon the following Explanation (iv)to sec 194C:
“work” shall include—

(a) advertising;

(b) broadcasting and telecasting including production of programmes for such broadcasting or telecasting;

(c) carriage of goods or passengers by any mode of transport other than by railways;

(d) catering;

(e) manufacturing or supplying a product according to the requirement or specification of a customer by using material purchased from such customer,
but does not include manufacturing or supplying a product according to the requirement or specification of a customer by using material purchased from a person, other than such customer.]

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