TaxTMI 
TaxTMI 
Payments to contractors and sub-contractors
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....ch income, such crediting shall be deemed to be credit of such income to the account of the payee and the provisions of this section shall apply accordingly. (3) Where any sum is paid or credited for carrying out any work mentioned in sub-clause (e) of clause (iv) of the Explanation, tax shall be deducted at source- (i) on the invoice value excluding the value of material, if such value is mentioned separately in the invoice; or (ii) on the whole of the invoice value, if the value of material is not mentioned separately in the invoice. (4) No individual or Hindu undivided family shall be liable to deduct income-tax on the sum credited or paid to the account of the contractor where such sum is credited or paid exclusively for personal purposes of such individual or any member of Hindu undivided family. (5) No deduction shall be made from the amount of any sum credited or paid or likely to be credited or paid to the account of, or to, the contractor, if such sum does not exceed ^17[thirty thousand rupees]: Provided that where the aggregate of the amounts of such sums credited or paid or likely to be credited or paid during the financial year exceeds ^20[....
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....y him exceeding one crore rupees in case of business or fifty lakh rupees in case of profession] during the financial year immediately preceding the financial year in which such sum is credited or paid to the account of the contractor; (ii) "goods carriage" shall have the meaning assigned to it in the Explanation to sub-section (7) of section 44AE; (iii) "contract" shall include sub-contract; (iv) "work" shall include- (a) advertising; (b) broadcasting and telecasting including production of programmes for such broadcasting or telecasting; (c) carriage of goods or passengers by any mode of transport other than by railways; (d) catering; ^22[(e) manufacturing or supplying a product according to the requirement or specification of a customer by using material purchased from such customer or its associate, being a person placed similarly in relation to such customer as is the person placed in relation to the assessee under the provisions contained in clause (b) of sub-section (2) of section 40A,] ^24[but does not include- (A) manufacturing or supplying a product according to the requirement or sp....
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....whichever is earlier, deduct an amount equal to- (i) one per cent, in case of advertising, (ii) in any other case two per cent, of such sum as income-tax on income comprised therein: Provided that no individual or a Hindu undivided family shall be liable to deduct income-tax on the sum credited or paid to the account of the contractor where such sum is credited or paid exclusively for personal purposes of such individual or any member of Hindu undivided family.] (2) Any person (being a contractor and not being an individual or a Hindu undivided family) responsible for paying any sum to any resident (hereafter in this section referred to as the sub-contractor) in pursuance of a contract with the sub-contractor for carrying out, or for the supply of labour for carrying out, the whole or any part of the work undertaken by the contractor or for supplying whether wholly or partly any labour which the contractor has undertaken to supply shall, at the time of credit of such sum to the account of the sub-contractor or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amo....
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....made under sub- section (2), from the amount of any sum credited or paid or likely to be credited or paid during the previous year to the account of the sub-contractor during the course of business of plying, hiring or leasing goods carriages, on production of a declaration to the person concerned paying or crediting such sum, in the prescribed form and verified in the prescribed manner and within such time as may be prescribed, if such sub-contractor is an individual who has not owned more than two goods carriages at any time during the previous year: Provided also that the person responsible for paying any sum as aforesaid to the sub-contractor referred to in the second proviso shall furnish to the prescribed income-tax authority or the person authorised by it such particulars as may be prescribed in such form and within such time as may be prescribed; or] (ii) any sum credited or paid before the 1st day of June, 1972; ^11[or] ^12[(iii) any sum credited or paid before the 1st day of June, 1973, in pursuance of a contract between the contractor and a co-operative society or in pursuance of a contract between such contractor and the sub-contractor in rela....
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....Act, 1995 w.e.f. 01-07-1995 3. Inserted vide Section 75 of the Finance Act, 2002 w.e.f. 01-06-2002 4. Inserted vide Section 39 of the Finance Act, 1994 w.e.f. 01-06-1994 5. Inserted vide Section 38 of the Finance Act, 1988 w.e.f. 01-06-1988 6. Renumbered vide Section 39 of the Finance Act, 1994 w.e.f. 01-06-1994 before it was read as, "Explanation" 7. Inserted vide Section 34 of the Finance Act, 1995 w.e.f. 01-07-1995 8. Substituted vide Section 37 of the Finance (No. 2) Act, 2004 w.e.f. 01-10-2004 before it was read as, "(i) any sum credited or paid in pursuance of any contract the consideration for which does not exceed twenty thousand rupees; or" Earlier, Amended vide Section 25 of the Finance Act, 1982 w.e.f. 01-06-1982 And was Amended vide Section 34 of the Finance Act, 1995 w.e.f. 01-07-1995 9. Substituted vide Section 49 of the Finance Act, 2005 w.e.f. 01-06-2005 before it was read as, "under this section; or" 10. Inserted vide Section 49 of the Finance Act, 2005 w.e.f. 01-06-2005 11. Inserted v....