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TDS on Power Supply purchase

Deepshikha Sharma (Tax Manager) (135 Points)

06 March 2021  

We are a goods manufacturing company and we have purchase Energy from a Power generation company. Whether TDS would be applicable on such purchase of power?? If yes, then which section, 94C??


 6 Replies

Kapadia Pravin (17209 Points)
Replied 06 March 2021

No deduction
1 Like

Practitising CA (57 Points)
Replied 06 March 2021

Depend if it is nature of contract
Check agreement if made
1 Like

Spurto Consultancy Services (Consultant) (1891 Points)
Replied 06 March 2021

It will all depend upon your agreement with the Power generation company. If there is any contractual agreement that they will generate some specific units and provide to you every month then there will be TDS liability u/s 194C otherwise no TDS deduction is required. 

1 Like

sabyasachi mukherjee (6718 Points)
Replied 06 March 2021

Generally electricity distribution company does not charge gst. But , if the electricity company gives on rental basis then also there are possibilities of charging tax.
The person paying the amount to the electricity distribution company charge tax on service charges raised by the electricity distribution company.

Kapadia Pravin (17209 Points)
Replied 06 March 2021

It's purchase of power and fuel. Like diesel, it is supply of electricity. No TDS deduction.

sabyasachi mukherjee (6718 Points)
Replied 09 March 2021

There is no tds on electricity distribution .

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