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TDS on commission paid by broker to its sub-brokers

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Querist : Anonymous

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Querist : Anonymous (Querist)
03 May 2010 As per the definition of commission & brokerage in Sec 194H it includes any payment received or receivable, directly or indirectly, by a person acting on behalf of another person for services rendered (not being professional services) or for any services in the course of buying or selling of goods or in relation to any transaction relating to any asset, valuable article or thing, not being securities.

On payment of brokerage by broker to its sub broker, is TDS u/s 194H to be deducted?

Some one has argued that the sub-broker is like an agent which promotes the business of the main broker by procuring clients and business for which the commission is paid. Hence, Tax is deductible on such commission u/s 194H.
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Aditya Maheshwari

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Aditya Maheshwari (Expert)
03 May 2010 Since some % of income is passed on to the subbroker the brokerage will attract the provisions of section 194H
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Aditya Maheshwari

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Aditya Maheshwari (Expert)
03 May 2010 Since some % of income is passed on to the subbroker the brokerage will attract the provisions of section 194H
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