special discount or commission
This query is : Resolved
12 July 2010
We seek your opinion on the following point,
We are agent of X company wherein the price list of co. product is Rs. 100. The co. has agreed to give 50% discount on price list to us. At the time of any order, the material is directly despatched by the co. ( E1 sale) and they bill the product on Rs. 55 ( after giving 45% discount) and we raise the commercial bill to our clients as per the order rate.
As the co. has agreed to give the product on Rs. 50 but they have billed the same on Rs. 55, we have to receive Rs. 5 from them.
Now, the point is how co. would be treating Rs. 5 while crediting our a/c? Can it be considered as special discount where there is no need to deduct TDS or will it be considered as commission?
We are agent of X company wherein the price list of co. product is Rs. 100. The co. has agreed to give 50% discount on price list to us. At the time of any order, the material is directly despatched by the co. ( E1 sale) and they bill the product on Rs. 55 ( after giving 45% discount) and we raise the commercial bill to our clients as per the order rate.
As the co. has agreed to give the product on Rs. 50 but they have billed the same on Rs. 55, we have to receive Rs. 5 from them.
Now, the point is how co. would be treating Rs. 5 while crediting our a/c? Can it be considered as special discount where there is no need to deduct TDS or will it be considered as commission?
20 July 2010
this can be treated like a special cash discount. the documents may be worded accordingly
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