tax deduction at source (TDS) under sections 194-I of Income-tax Act would be required to be made on the amount of rent paid/payable without including the service tax.
It only say's about Sec 194-I what about other Sec.?
I agree with Suhas and the said circular talks about section 194 I only. Nobody should interprete the said circular in his/her own discretion. TDS should be deducted on gross amount including service tax in all other cases except Rent.
TDS only applicable if, the total Rent paid is morethan 1,20,000/- P.A., which not included Service tax. So, TDS rate will be applicable over 1,20,000/- only.
If tds is deducted on entire professional charges amount inclusive of service tax what will be the accounting effect ie:how much will be the income of the service provider...if only the professional charges then dont you think the service provider is given excess credit of tds on service tax also.