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TDS Applicable or Not

23 March 2009

I am working as Accountant in one of the big EDUCATIONAL TRUST in Bombay. We have spend lots of amount on printing items i.e. for printing Question papers, Answer Papers, ReportCards & Other Office Stationary. My question is Can TDS is applicable on such payments & Why ?

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4 Replies

CA Ankur Dhamanaskar (Student) (295 Points)
Replied 23 March 2009

Have your trust entered into any contract for the same................????

Arvind (Article) (150 Points)
Replied 23 March 2009

Originally posted by :Bharat
"	I am working as Accountant in one of the big EDUCATIONAL TRUST in Bombay. We have spend lots of amount on printing items i.e. for printing Question papers, Answer Papers, ReportCards & Other Office Stationary. My question is Can TDS is applicable on such payments & Why ?	"

IF printing and staionery shop does works according to your specification will fall under works contract u/s194c so tds applicable

Rajesh Kumar (Advocate- Tax) (7806 Points)
Replied 23 March 2009

TDS is applicable.

(Guest)

Yes.
Circular No. 715, dated 8-8-1995 on the subject of applicability of section 194C, in respect of contract for supply printed material as per prescribed specifications, it has been said that such contracts would also be covered under section 194C.

Before taking a decision on the applicability of TDS under section 194C on a contract, it would have to be examined whether the contract in question is a ‘contract for work’ or a ‘contract for sale’ and TDS shall be applicable only where it is a ‘contract for work’. It is, therefore, clarified that the provisions of section 194C would apply in respect of a contract for supply of any article or thing as per prescribed specifications only if it is a contract for work and not a contract for sale as per the principles in this regard laid down in para 7(vi) of Circular No. 681, dated 8-3-1994.

If printing charges are fixed for all card say Rs 200.00 irresprctive of Qty ordered then 194C would not applicable as it "contract for sale’ and "not for contract of work".

>>Vipul Garg