Tax Deduction at Source

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..... Tax Deduction at Source
Query (Issue) Started By: - Pradeep Kaushik Dated:- 29-8-2011 Last Reply Date:- 5-9-2011 Income Tax
Got 3 Replies
Income Tax
Respected Sir, We are an excisable goods manufecturing comapny. Out of our 5 suppliers, there is one suppllier to whom we are selling the Raw Material. He is adding some more parts to our material and selling back to us. (Excise and VAT .....

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..... is being charged by both of us on sale Invoice). we are deducting the TDS on his invoice value, under contract ( TDS U/s 194C). Now the suppliers is arguing with us for non duduction of TDS U/s 194C. He is saying that this is simple sale & purchase transection between us. He is not accepting our deductions. Please send us the clearification, so that we can make our suppliers satisfied in this is .....

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..... sue. Best Regards. Pradeep Kaushik Reply By PAWAN KUMAR SHARMA: The Reply: There cannot be any TDS on Sales & Supplies. Once a supplier raised a Tax Invoice and charged VAT/CST no TDS would be deducted. Reply By Pawan Agarwal: The Reply: In the given case TDS is deductible U/s194C. Attention is invited to Clause (iv)(e) of Explanation to Section 194C according to which "Work shall include-- ( .....

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..... e) manufacturing or supplying of product according to the requirement or specification of a customer by using material purchased from such customer, but does not include manufacturing or supplying a product according to the requirement or specification of a customer by using material purchased from from a person ,other than such customer." Further, non deduction of TDS may attract disallowance u/ .....

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..... s 40(a)(ia). Reply By r.rajkumar kumar: The Reply: tds cannot be deducted when y are raising invoice with duty and local tax and he developed and send back to y which the a new shape alongwth duty invoice and local tax . Than this comes under sale of goods hence no tds is reqired.
Discussion Forum - Knowledge Sharing .....

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