TDS U/S 194C OR 194

[ROHIT GOEL]

DEAR Experts,

Under a contract, following services are provided by a a professional consultancy firm "A":

A) Supply of 2 full time Consultants to a Client who shall be located at client premises at all times however be on payroll of firm A. Client shall pay Cost to A plus 10% in exchange of such manpower supply.

B) Supply of offsite consultancy to the same client.

Under contract, separate consideration of both 2 works is specified. Whether it shall be permissible if client deducts TDS u/s 194C on manpower supply portion and TDS u/s 194J on offsite consultancy portion?

If yes, kindly refer to any precedent/judgment in support.

AI Summary

Contract characterisation governs TDS applicability - treat combined manpower supply and consultancy by substance, not mere billing.
Whether TDS applies under different provisions depends on characterisation of the arrangement: if the consultant supply and offsite consultancy constitute a single contract in substance-assessed by terms, scope, obligations and contractual architecture-the essential nature of the combined performance governs the applicable TDS sub-section; genuinely independent contracts with distinct scopes may attract separate TDS treatment, but separate consideration or invoicing alone will not be conclusive and artificial bifurcation can be disregarded.