Tds on supply of goods to govet department

This query is : Resolved

CA Umesh Sakpal (Querist)
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29 August 2011 We are the manufacturing company in the supply of stationery items to the Govt department. We supply these goods according to the order received from the Government department. While processing our payments against supply of Goods, these government departments are deducting TDS from our payments U/s 194C.

Is their any notification / circular from Income Tax department so that we can convince them to not to deduct TDS from our payments for supply of goods of materials ?

CS Bijoy

CS Bijoy (Expert)
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31 August 2011 In case of any transaction with government, if government is the receiver than TDS is not required to deduct but in the above case you are the receiver so Government deduct TDS.

CA Umesh Sakpal

CA Umesh Sakpal (Querist)
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31 August 2011 But whether TDS is applicable on sale of goods ? We are supplying materials to the Government. In the normal circumstances, if we are supplying goods to the parties, parties give full payments but in the case of supply to the government department, they are doing payments after deduction of TDS for the sale of goods to them.

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