Service tax applicability - deduction of TDS

[paresh zatakia]

Dear Sirs, If there is no service rendered as provided under the act,is service tax payable simply because payer has wrongly deducted tds u/s 194j? regards c.a.paresh zatakia

[Mukesh Kumar]

The provisions of both the acts are independent. The issue of taxability of a particular activity must be seen in view of statutory provisions of Finance Act, 1994 only. These are nothing to do with deduction of TDS under section 194J of Income Tax Act, 1961.

AI Summary

Service tax applicability remains governed by service law, unaffected by erroneous TDS deductions under income tax procedures. Applicability of service tax depends on statutory criteria under the Finance Act and must be determined by the nature of the activity; an erroneous deduction as TDS under the income tax law does not affect or determine service tax liability because the two statutory schemes operate independently.