A Window software purchased by a customer worth rs. 49692/- (including service tax and vat), While making of payment towards this invoice should he deduct TDS as he received invoice with Service tax ????
22 Replies
Hemant Kumar
(Accounts Manager MBA (Fin) CMA*)
(6450 Points)
Replied 12 June 2012
TDS Should be deduct on total bill amount. i.e 49692/-
CA. Amit Prajapati
(Chartered Accountant)
(118 Points)
Replied 12 June 2012
If the customer has purchased the Windows Software that means you must be a dealer for Microsoft. As per the lastest judgement by Delhi High Court in case of CIT v/s Dynamics Vertical Software India P Ltd TDS is not required to be deducted.
Saliq Ansari
(CA_Final Student)
(885 Points)
Replied 12 June 2012
Agreed with Hemant TDS will be deducted on complete amount including Service Tax
CA. Amit Prajapati
(Chartered Accountant)
(118 Points)
Replied 12 June 2012
The point is that Windows Software is operating program and which is essentials to run the computer and without which the computer cannot operate so as per the accounting principle the cost of the Windows package needs to capitalise with the Hardware computer. General perception is that you need not deduct TDS on Capitalised amount. You will always be liable to pay TDS irrespective of whether expenditure is claimed or not.
The case law I referred is from CA final case study. This case law was for the payment to Microsoft in case of royalty to non resident. You may ignore the case law which I referred originally for a while. I take my words back.
In that case it is right to deduct TDS under 194J as Royalty on whole of the Invoice Amount.
LALIT KUMAR GANERIWAL
(accountant)
(241 Points)
Replied 12 June 2012
YES TDS DEDUCTION IS NOT REQUIRED
IF YOU PAY A BILL OF LODGING & FOODING YOU R DEDUCT TDS FROM THERE BILL
CA Biswaranjan
(job)
(149 Points)
Replied 12 June 2012
TDS is not required to be deducted, for purchasing the software.
ARUN SUNDAR.S
(OFFICER-ACCOUNTS)
(20 Points)
Replied 13 June 2012
Tds should be deduct in Service tax portion of the invoice
Arun sundar.
Prateek Agarwal
(Sr. Executive - Finance & Accounts)
(1732 Points)
Replied 13 June 2012
Yes TDS needs to be deducted.
CA Rahul Khatter
(Chartered accountant)
(97 Points)
Replied 13 June 2012
arey yaar kyu TDS kaatna hai ... aur kis section m katounge ... aur haan yeh sirf sale purchase ho rhi hai ... koi royalty ke liye payment thode hain ... kabhi suna hai maine vendor se purchase kiya kuch uspe TDS kaata fir payment ki ... NO TDS
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