TDS on works contract

Deepak Tapse (Accounts Manager - Taxation)   (1771 Points)

21 April 2011  

We have given AMC for Machinery. The party given us two seperate bill as under

1. Annual Service Charges - Labour        80000 +  S.Tax     8240/-  = 88240/-

2. Parts sale under AMC Contract            120000 + Works contract Tax 15000/-  = 135000//-

My question is, TDS to be deducted only on labour charges i.e 88240/- or on full amount of Rs. 223240/-

Thanks