Reverse charge mechanism

This query is : Open

Sankar Chakraborty (Querist)
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15 January 2014 A DIRECTOR OF A PVT LTD CO. WHO IS IN EMPLOYMENT (SALARY PAID MONTHLY) WAS GIVEN EXTRA AMOUNT TOWARDS HIS MEDICLAIM (CHEQUE GIVEN IN THE NAME OF THE SAID DIRECTOR)

SHOULD WE DEDUCT TDS U/S 194JBA ?
SHOULD DEDUCT SERVICE TAX UNDER RCM ?

PLEASE HELP

motichand gupta

motichand gupta (Expert)
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15 January 2014 i would give answer in two situations-
a. where mediclaim amount recovered from employee.
b. where mediclaim amount not recovered from employee.

Since, Director is an employee of a company, employee employer relationship governed.
in situation (a)RCM shall be applicable as here employer is providing the service and later recovering from employee.
in situation (b), cost is borne by the Company and therefore no RCM is applicable as assumption is made that this has been incurred during employee employer relationship.
For more clarification on , pl. read Department draft circular dated 27.12.2012

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on this Sec 194J is not applicable.

Sankar Chakraborty

Sankar Chakraborty (Querist)
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15 January 2014 MEDICLAIM AMOUNT WILL NOT be reCOVERED FROM EMPLOYEE SO RCM IS NOT APPLICABLE

BUT WHY 194Jba is not applicable ?

as payments other than salary to director attracts u/s 194jba

please cinfirm

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