The Central Board of Direct Taxes(CBDT) has clarified the issue vide Circula No. 715 dated 08-08-1995. The relevant portion is quoted below.
"Routine, normal maintenance contracts which include supply of spares will be covered under section 194C. However, where technical services are rendered, the provision of section 194J will apply in regard to tax deduction at source."
Hence Annual Maintenance Contracts(AMC) are liable to TDS. Whether Section 194C or Section 194J is attracted is to be deduced from the nature of the contract.
yes, tds shd be deducted. if its a single contract, Amt shd exceed Rs.20,000/- p.a and if it is a multiple contract the amt shd exceed Rs.50000 for the pupose of deducting tax at source
u/s 194c,when tds is to be deducted,where single contract is less than 20000 but annual amount in march month becomes more than 50000 (first time contract/job work with party)