TDS on payment made to Hotel

This query is : Resolved

Rajnish Amipara (Querist)
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19 May 2008 What should be the rate of TDS on payment made to hotel for the following services received by pvt.ltd.co. for the business purpose....

Room charges rs. 6,00,000/-
Conference hall charges rs. 40,000/-
DJ Music charges rs. 10,000/-
Transport charges(Hire) rs. 65,000/-
Equipment charges Mike,Screen rs. 20,000/-
Extra charges during stay rs. 1,80,000/-
TOTAL AMT. = Rs. 9,15,000/- for which hotel has raised single bill.

However Friquency of such instances are minimal & further there is no contract with the hotel. Company has received such services continuously for 4 days.

Regards

Rajnish Amipara
amiparasir@gmail.com

CA. Vineet Grover

CA. Vineet Grover (Expert)
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19 May 2008 Hi Rajnish,

There is no TDS implixcation on the said transaction.

If a contract is executed wherein the hall / room are used throughout the year TDS u/s 194J would have been applicable.

Rgds/
Vineet

CA. Yayati Tyagi

CA. Yayati Tyagi (Expert)
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19 May 2008 please refer to a same query on this site by Sanjeev Kumar Varshney on 07/07/2007.

Payments made by persons other than individuals and HUF for hotel accommodation taken on regular basis will be in the nature of rent subject to TDS under section 194-I. (circular 5/2002)

i think your case does not fall ubder "regular basis". So, TDS should apply under section 194C on total payment to hotel. contract need not be in written. it was a verbal contract (or understanding) between you and hotel to use its services and now payment is over rs. 20,000, so TDS is applicable under 194C.

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S.Srinivasaraghavan

S.Srinivasaraghavan (Expert)
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20 May 2008 Section 194C is applicable only if a contractor carries out any work for you. The contract need not be in writing.

194J is applicable only if the resident renders professional or technical services.

194I is applicable if payment is in the nature of rent for use of land, building, furniture fittings etc.,

Please clarify the nature of arrangement and payment