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Issue ID : 2594
- 0 -

TDS for Water Supply Service

Date 04 Jan 2011
Replies2 Answers
Views 58741 Views
Asked By

Payment is made to an agency for supply of water. The payment includes the amount to be paid for water + transportation cost. Please advice if this payment attracts TDS u/s. 194C

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Replied on Jan 4, 2011
1.

Section 194C is attracted on sale of services and not sale of goods.

Supply of water in our opinion is sale of services. Further procurement of water is contractual in nature may be for year or month. Hence TDS should be deducted u/s 194C.

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Replied on Jan 5, 2011
2.

Tds is applicable on water supply. It shall be levied under section 194C (Payments to contractors and sub-contractors) of the Income Tax Act,1961.

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