For supply of materials as per our specification, we sign an agreement with a manufacturer and he manufactures and supplies us without taking raw materials from us. He claims VAT in the bill.
Because we have entered into an agreement with him, is it a contractual payment and does it involve TDS
It is a trading activity. so TDS is not applicable in this case.
TDS is applicable on expenditure , not on purchase.
TDS not applicable.
TDS is not applicable as because
1. he is delivering goods to you - Not an expense
2.He is charging VAT hence he gives you sales invoice - it is a sale
3.Sale does not amount to contract.
Twenty Point Nine Five Ventures Private Limited
Noida
CA Inter
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CCI
Pro
CAclubindia
