TDS Problem Related to Section

A Firm provides us the services regarding the maintenance of AC and he charges us monthly. For this work he provides us four employee for the whole day. It is a contract for such repair , maintenance & operation of such AC plant. Previously we deduct TDS U/S 194C as contractor @ 2%. But during statutory audit auditor say that it is like Professional & Technical Services U/s 194J and we should deduct TDS @ 10% and we begin to deduct TDS @ 10%. But problem is that the other client of that contractor deduct @ 2%. But and contractor shows the TDS certificate and say to deduct @ 2% instead of 10%. Solve the problem .

Replies (24)

Dear Manoj,

On a funny side I would say "Why don't u ask this question to the auditors who suggested Sec 194 J"

I think it will fall u/s 194C......

Mr.Manoj

Agree with Mr.Amir brother...

194 C.....contract for repair , maintenance & operation of  AC plant.

I agree with Amir.....it will fall u/s 194C

It is a contract for work .. I think there is no rendering of professional or technical assistance.. AM I RIGHT

It would fall under section 194c and not 194j as i too have encountered the same situation during our audit

Dear Manoj,

First you see in the invoice that the contractor registered in service Tax , it means he collect service tax from your firm. If he collect service tax then he belongs to deduct TDS U/S 194J otherwise treat him as normal contractor and deduct TDS U/S 194C (2%)

Dear Nitin,

DO U MEAN TO SAY THAT SERVICE TAX IS APPLICABLE ONLY ON PROFESSIONAL??

No my friend, take an example of construction contracts, they r liable to service tax & TDS is deducted u/s 194 C.

Mr.Nitin

I think Mr.Amir brother is right.....

I hope your Statutory Auditor Should study the Provisions of Section 194c in details...

It will fall under section 194C......

 

Repair & MAintenance of A/c will for sure fall under Section 194 C because it is contract for work and services.

Make you auditors read the bare text of both the section it will be clear for them

 

 

194c............

But Friend Statutory Auditor demads from the contractor the certificate issued by the IT Deptt showing that the contractor falls in sec 194C and not in 194J . Is the demand is genuine ? If yes then I will suggest to the client to get the certificate from the Contractor.

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