TDS on payment of endorsed bill of Exchange?

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  1. Kashyap Shettigar

    Kashyap Shettigar New Member

    Hi,
    I would like to know whether there shall be any TDS deductible on payments made to an endorsed bill of exchange.
    For example - if the payment relates to professional fees & TDS is liable to be deducted at 10% u/s 194J, had the payment been made to the creditor directly. But in case the creditor endorses his receivable to someone else, the payment is being made to a third party on behalf of the creditor. Shall such payment be under the purview of TDS?
     
  2. ZED

    ZED Well-Known Member

    The liability to deduct tax arises ,earlier of , the time of credit in the account of the payee or at the time of payment.
    TDS provisions are still applicable in this case.


    194J. (1) Any person, not being an individual or a Hindu undivided family, who is responsible for paying to a resident any sum by way of—

    (a) fees for professional services, or

    (b) fees for technical services, or

    (ba) any remuneration or fees or commission by whatever name called, other than those on which tax is deductible under section 192, to a director of a company, or

    (c) royalty, or

    (d) any sum referred to in clause (va) of section 28,

    shall, at the time of credit of such sum to the account of the payee or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amount equal to ten per cent of such sum as income-tax on income comprised therein :
     
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