Ad-Free CAclubindia and Daily Updates on your mobile. Subscribe Now!

Tds on c&f charges

Rajiv (Senior Accounts Officer) (1548 Points)

28 January 2016

We are a pvt ltd company we received c & f invoice. c & f agent submits two bills one for reimbursement which includes warehouse charges, xerox charges, D.O. charges, transportation charges, documentation charges, stamp duty, loading and unloading charges and octroi duty and one of his agency bill which includes consolidates agency charges and license registration charges. I am under impression that no tds u/s 194c will be deducted on reimbursement bill and tds u/s 194c will be deducted on agency bill. Please specify whether i m correct or not and is there any circular or notification regarding my query

Reply
Follow
Share

3 Replies

CA Mehul Chudasama (Chartered Accountant) (618 Points)
Replied 28 January 2016

Income Tax Officer Ward- 6(1), Ahmedabad Versus Shri Pravin B. Kachadia HUF and Shri Pravin B. Kachadia HUF Versus Income Tax Officer Ward-6(1), Ahmedabad - 2015 (2) TMI 62 - ITAT AHMEDABAD

Non deduction of TDS on clearing and forwarding charges - disallowance u/s 40(a)(ia) - assessee s submission that the amount paid to C & F agents includes the expenditure which has been reimbursed to the clearing and forwarding agents and there is no element of profit in it - Held that - We find that there is no finding of Ld. CIT(A) that the amount paid by the assessee was not in the nature of reimbursement but on the contrary he has held that there cannot be any exemption from TDS even in case of reimbursement. As find that the issue of disallowance u/s. 40(a)(ia) amount paid to the clearing and forwarding agents with respect to the reimbursable expenditure was also before the Co-ordinate Bench Tribunal in the case of Gujarat Narmada Valley Fertilizer Company Ltd 2015

Upgrade to CAclubindia Pro. Subscribe Now!

Labdhi (Article Assistant) (85 Points)
Replied 28 January 2016

https://www.google.co.in/url?q=https://carockstar.wordpress.com/2014/02/24/applicability-of-tds-on-payment-to-cha-agent/&sa=U&ved=0ahUKEwji-Jzf3szKAhUhHKYKHZIHBDAQFggXMAI&usg=AFQjCNE15LJXZB9SgbBs1CQRKx5gHo_Qyg Refer to above mentioned link..all your doubts will be solved.. In summary : TDS will be not deducted on reimbursable expenditure.

deep gosar (ca) (22 Points)
Replied 30 January 2016

Tds will not be deducted on reimbursement amt...basic abt tds is that on expense tds should be deducted so on the expenses which are not reimbursable tds should be deducted...