13 December 2012
If I have received an invoice for technical service for Rs.100000 on which Sevice Tax @ 12,3% is charged totaling to Rs.112300.as invoice amount . Now at the payment I have to deduct TDS U/S 194J of 10% on Rs.100000 or 10% Rs.112300. I would be very thankful to you if you can kindly provide me a correct conclusive answer for this issue. Thanks. CA.L.Natarajan
CBDT has clarified this issue in Circular no 275/73/2007IT dated 30.06.2008. Accordingly, TDS is required to be deducted on whole amount including Service Tax Portion.
These is only one exception to this rule which is TDS u/s 194I (TDS on Rent). Under 194I, TDS is to be deducted on Rent Portion only.
14 December 2012
Agreed with Mr. Thakkar. On a careful study of Sec 194J you will observe that. The words used are " Any Sum paid...." Therefore Tax should be deducted on any sum paid to receiver.
SImilary in section 194I the words used are " Any Income by way of rent..." and service tax is not an Income thus in sec 194 I we do not include service tax for tds.
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