Tds on payments to hotel for sales promotion and conference

Hi,

Our client, a leading pharmaceutical company (private limited) is organising sales promotional meetings and conferences among their sales staff and outsiders by booking hotel facility. This programs are organised in different hotels located nearby.

The charges collected by the hotel include room rents, conference hall rent, rent for other facilities like mike, projector etc, and for food.

We accounted such expenses as sales promotional expenses in our books.

Our query is;

1) whether TDS need to be deducted on such trannsactions? If yes under which section?

2) Kindly quote relevant circulars and case laws for supportings.

Replies (2)

the nature of exp incurred by your co is in the form of advertisement to promote teh sales of teh company.So I think TDS u/s 194C @ 1% towards advertisement shud be made to be on the safer side as the dept may make an enquiry later on.

this is not advertisment

yes, it will be deal by 194C.  it is 2% because i don't think hotel will be individual or HUF.

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