03 February 2012
In our company we are hiring employees on Third Party Contract(TPC) basis. Earlier we used to deduct tax u/s 194C as a Manpower supply contract.
But now the contractor is saying we are reimbursing the salary to him so the transaction is not liable to deduct tax u/s 194C. Now in his bill he is specifically mentioning "Reimbursement of Salary of Mr. _________", THOUGH HE IS CHARGING SERVICE TAX ON THAT.