Works contract

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Querist : Anonymous

Querist : Anonymous (Querist)

06 January 2014 what is the treatment of works contract u/s 194c? in case of material supplied by the contractor himself and material supplied by the contractee...

Anumanchipalli Sathikonda

Anumanchipalli Sathikonda (Expert)
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06 January 2014 Mr./Ms.XXXXXXX
Please refer to sub-section (3) of section 194C which reads as under-

"(3) where any sum is paid or is credited for carrying out any work mentioned in sub-clause (e) of clause (iv) of Explanation, tax shall be deducted at source-
(i) on the invoice value excluding the value of material, if such value is mentioned separately in the invoice; or
(ii)on the whole of the invoice valuse, if the value of material is not mentioned separately in the invoice."

sub-clause (e) of clause (iv) of Explanation reads as under-
"(e) manufacturing or supplying a product according to the requirement or specification of a customer by using material purchased from such customer,
but does not include manufacturing or supplying a product according to the requirement or specification of customer by using material purchased from a person, other than such customer."

Hope you have got clarification.

Best Wishes

Sathikonda

Querist : Anonymous

Querist : Anonymous (Querist)

06 January 2014 in case contractor charges vat on total invoice value then what is the treatment u/s 194c??

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Anumanchipalli Sathikonda

Anumanchipalli Sathikonda (Expert)
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06 January 2014 Mr./Ms.XXXXXX

You must deduct tax at source from the entire value of the invoice (including VAT).

Best Wishes

SathikondaA