Example 1: Indirect Expenses (Fees for Professional or Technical Services (Section 194J)
Manohar is a technical consultant for automobiles. He inspects used cars and prepares a report. Manohar (seller of the service) receives per car, Rs.500 for inspections. He inspects five cars in January 2005. So he has to receive Rs.2500 as service charges. Company 'A' pays him Rs.2250 towards service charges and pays Rs.250 to any Bank or IT counter towards TDS.
The following diagram explains the transaction flow in TDS:
