No TDS deduction on service tax paid

Q) I am a consultant. From my clents, I collect consultation fee and 10 per cent service tax thereon. Fees and on the same I charge service tax @ 10 per cent (prior to 1.10.09@10.3 per cent) on fees. My client has to deduct TDS on 10 per cent on the fees amount from 1.10.2009 onwards. But he has deducting TDS on the total bill amount. Hence he is deducting TDS on service tax also.
In my opinion this is wrong. I have to remit to service tax department what I receive from my client as service tax. In the above case, I have to remit service tax billed by me minus TDS of 10 per cent. Please clarify. Is there any circular/ section which states the amount from which TDS has to be calculated.
K Ramadoss
Via e-mail

A)Your contention of deducting TDS only on the professional fees excluding the service tax component is absolutely right. In this context, it is pertinent to note that as per the circular no 4/2008 dated 28th April, 2008 issued by the CBDT, “Service tax paid by the tenant does not partake the nature of income of the landlord.
The landlord only acts as a collecting agency for Government for collection of service tax. Therefore, it has been decided that tax deduction at source (TDS) under sections 194-I of Income Tax Act would be made on the amount of rent paid/ payable without including the service tax.”
Though the circular is in respect of rent payment but the principle set in the circular applies to all other payments.
Therefore, tax deducted at source under Section 194J would be required to be made only on the amount of professional fees excluding the amount of service tax.

Q) I am working in foreign airways. The contract period is one year and each year the contract period is renewed. I am getting Rs. 15000 pm. There is no TDS Certificate and they are not deducting any TDS.
How I can file my Income tax return. Should I file in ITR 1 or any other form. Is it possible to file return without TDS Certificate?
S.Prabhu
Via e-mail
A) Return in ITR 1 can be filed if you have income pertaining to salary and interest income. In case you have any other source of income, you need to file your return of income in the appropriate form. Further, return of income can be filed without the TDS certificates since no enclosures are required to be filed with the return of income.

Q) I am NRI - US citizen. I bought some properties in India about 4 years back using money from dollars transferred from US.
I want to repatriate some dollars back to US and if I sell any of the properties can I repatriate the dollars that I sent to India to buy the properties. Also any capital gains I get out of selling - are they taxable in India.
Shravan Kumar
Via e-mail

A) You may be liable to pay capital gains tax liability on the sale of properties in India. The repatriation of the amount shall be permissible only on payment of capital gains tax liability. However, repatriation of funds is not permissible in the case of sale of certain specified assets.

(Kamal Rathi is a chartered accountant, representing Rathi & Malani, a Hyderabad-based accounting firm.
Readers can mail their queries on income tax to kamalrathi.ca@gmail.com)