Tds applicability on reimbursement

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..... Tds applicability on reimbursement
Query (Issue) Started By: - pradeep kataria Dated:- 10-9-2009 Last Reply Date:- 14-9-2009 Income Tax
Got 3 Replies
Income Tax
Co. X is using the services of CHA. CHA raises two bills for each transaction, in one bill he claims his agency charges etc. and another bill he claims the reimbursment of expenses incurred on behalf of Company X. Whether the .....

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..... COmpany X is suppose to deduct TDS on Reimbursement bill also. Please clarify with relevant citiation/Notification etc. Reply By Surender Gupta: The Reply: The issue which I understand is to determine the nature of transaction. Whether it is in the nature of reimubrement of expenses which is incurred by the CHA on behalf of company or the cost in the hands of CHA. Once it is said that CHA has in .....

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..... curred the expenses on behalf of company and reproduce the original consignment note before the company without making any profit out of it, I think company should deduct TDS on such transaction. However, w.e.f. 1-10-2009 on production of PAN, no tds would be deducted from transporter. Reply By pradeep kataria: The Reply: Dear Mr. Surender Thanks for your reply. As per your opinion, we should not .....

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..... deduct if profit element in not included in CHA bill. Will you please cite any case law etc. in its support. Pradeep Kataria Reply By Rama Krishana: The Reply: The concept is new one and the issue would be decided by the courts in due course. But since the bare provisions of law itself clear, you may refer to provision of rule 5 of the Service Tax (Determination of Value) Rules, 2006 - where t .....

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..... he CHA is acting as pure agent, he is not liable to include or pay service tax on the GTA service. Where you are paying amount of GTA through agent, it is your liability.
Discussion Forum - Knowledge Sharing .....

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