Applicability of tds pmt made by ad agency to publisher ????

This query is : Resolved

CA Abhishek Singh (Querist)
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22 August 2012 Hello everyone,

one of our client is a pvt ltd company. it is an ad agency. it buys ad space in newspapers and magazies from publishers such as HT, DNA etc.

he sells that space to the client.

i advised him to deduct TDS@1%/2% u/s. 194C on payment made to the publishers.

However the accountant of the publisher argue that TDS is not applicable and that the company should not deduct TDS ?

waiting for the views of the experts.

CA VISHNU GAVKARE

CA VISHNU GAVKARE (Expert)
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23 August 2012 Dear Abhishek,
If your client just purchase the space 194c will not be applicable as there is no contract.but if it books that space and later on transfers to other party 194c will be applicable. Looking at information given by you 194c will not be applicable.

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CA Abhishek Singh

CA Abhishek Singh (Querist)
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23 August 2012 my client books the space in the newspaper/magazines say for one month.

publisher says not to deduct TDS.

Does my client require to deduct TDS while making payment to the publisher ?

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CA VISHNU GAVKARE

CA VISHNU GAVKARE (Expert)
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23 August 2012 no in that case it will not be applicable as your client is just purchasing a space. Newspaper agency is transfering property in the goods that is space in newspaper. hence tds not applicable.