16 May 2010
Its no where specified in Income Tax Act, that the TDS would not be deducted on speciific expense. Sales promotion is something related to advertisement and it would fall in defination of contract. So, TDS would be deducted on it @ 2% under section 194C. Further, the TDS would be 20% if the PAN no. is not obtained from the respective supplier or contractor. And one more thing, the TDS rate would be 1% in case of individual or HUF and in all other cases, it would be 2 %.
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