CBIC has released a notification dated 5.11.2018 vide which a new proviso has been inserted that TDS under GST is not required to be deducted on transactions between Public Sector Undertaking to Public Sector Undertaking wef 01.10.2018.
From this new amendment government has clear its intend that Unlike Income Tax ,TDS under GST is only a Anti tax avoidance measure and not a method of advance tax collection.Its is made applicable just to create a audit trail of the transactions.
The notification in this regard is given as under
[To be published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i)]
Government of India Ministry of Finance (Department of Revenue)
Central Board of Indirect Taxes and Customs
Notification No. 61/2018 – Central Tax
New Delhi, the 5th November, 2018 G.S.R. …..(E).—
In exercise of the powers conferred by sub-section (3) of section 1, read with section 51 of the Central Goods and Services Tax Act, 2017 (12 of 2017), hereafter in this notification referred to as the said Act, the Central Government, on the recommendations of the Council, hereby makes the following further amendments in the notification of the Government of India in the Ministry of Finance, Department of Revenue No. 50/2018-Central Tax, dated the 13th September, 2018, published in the Gazette of India, Extraordinary, Part II, Section 3, Subsection (i) vide number G.S.R 868(E), dated the 13th September, 2018, namely:– In the said notification, after the proviso, the following proviso shall be inserted, namely:-
“Provided further that nothing in this notification shall apply to the supply of goods or services or both from a public sector undertaking to another public sector undertaking, whether or not a distinct person, with effect from the 1st day of October, 2018.” .
[F. No. CBEC/20/06/16/2018-GST]