Ashok (Executive officer) (48 Points)
01 April 2009Dental technician is a person who makes the teeth for the patients,as per advise by dentist
He charges the making cost to the dentists. He charges VAT on the bills.
Approximate amount of payment is about 100000 Rs per year
Does doctor need to cut TDS on the payment of the bills paid to Dental technician.
Is it a manufacturing activity? Is it a technical service.
what rate of TDS applicable?
Shubhankar Limaye
(B.Com.)
(174 Points)
Replied 01 April 2009
Sir,
Let us consider sequence of events involved while making denture.
In such case we must look at the process of making dentures thoroughly. I perceive the process as something that is executed mechanically after proper inputs are provided. In view of this, the contract for making dentures falls into the ambit of Section 194C, more particularly within the ambit of the expression 'any work'. Therefore the payments made to said technician shall be subject to deduction of tax at source. It would not matter whether the technician has charges VAT or Service Tax as principally it is a contract for executing the work as prescribed.
SANJAY VERMA
(Chartered Accountant)
(334 Points)
Replied 01 April 2009
Firstly TDS is applicable in case of indivdual only if his turnover exceeds the limit prescribed u/s 44AB.In the case of proffesionals the limit is 10 lakhs. I dont think the transactions involved in the case of dentures can be treated as professional reciepts. That can be treated as sale, so if the turnover in respect of sale part exceeds 40 lakh then he is liable to TDS.
Shubhankar Limaye
(B.Com.)
(174 Points)
Replied 02 April 2009
Sir,
The doctor would be liable to deduct tax at source if his professional receipts exceed Rs. 10 Lacs in immediately preceeding previous year, nothwithstanding the turnover of Denture sales.
M.M.SURANA
(Director -Taxation )
(532 Points)
Replied 02 April 2009
Sir,
In my opinion TDS will not be applicable. since your techician is charging the vat on the bill. hence It is the nature of supply of goods. Dentist job is to fix the teeth and collect the fixing charges as a professional and technical person. If activity involve in trading means If U raise the bill for material as well as for your professional services also, than 44AB will applicable. In that case also for the supply of goods U need not to deduct the tax.
CAclubindia
