Section 194C

[Guest]

CBDT two circular namely No 4 of 28/4/2008 and 275/73/2007IT(B) dt 30/06/2008 clearly states TDS would be deductable from gross amount including serv tax however same is not applicable for 194J. what about the situation for 194C for contractor and subcontractor casess

[Guest]

The said exclusion is available only for 194 J and not for deductions under other sectons

[Guest]

The logic given by the Board in the above Circular is while Sec.194I requires deduction of tax on 'any income by way of rent', Sec.194J requires deduction of tax on 'any sum'. On the basis of same logic, Sec.194C also requires deduction of tax on 'any sum' and thus needs to be applied on the gross amount including service tax component, if any.

[DEV KUMAR KOTHARI]

The circular in relation to professional fees is wrong. The board has considered few words and nto all words in S. 194 J. The TDS is to be from fees and nothing else. For detaied discussion refer articles on this website.

AI Summary

Debate on Section 194C: Should TDS Include Service Tax for Contractors? Clarifications on CBDT Circular Interpretation. A discussion on Section 194C of the Income Tax Act questions whether TDS should be deducted on the gross amount, including service tax, for contractors and subcontractors. The responses clarify that the exclusion of service tax from TDS applies only to Section 194J, not Section 194C. One participant argues that, based on the logic of the CBDT circular, Section 194C requires TDS on the gross amount, including service tax. Another participant contends that the interpretation of the circular regarding professional fees under Section 194J is incorrect, suggesting that TDS should apply only to fees.