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TDS on Vehicle Hire (Income Tax)

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This query is : Resolved


( Author )
05 September 2007

With the amendment to Section 194 I definition on Rent w.e.f.13.07.2006, the Rent includes Hiring of Plant & Machinery also.
In my opinion, hiring of vehicles i.e., taxi or hiring of a car on a continuous basis does not come under Section 194 I because, the Rent definition does not include 'Vehicles'
I also think Plant & Machinery U/s 194 I does not include Vehicles.
1.Am I correct in this understanding?
Now, with this please clarify me also,
2.Whether TDS on hiring of tractors ( with RTO Regn. ) for removal of waste etc.comes under 194 C or section 194 I?


CA Mani

( Expert )
06 September 2007

Hire of vehicles(Operating lease/ Finance lease) will fall U/s.194I as pet Taxation Laws Amendment Act, 2006


Shyam Lal Naik

( Expert )
06 September 2007

In a recent case, the Bombay High Court has held that, section 194-I is not attracted in the case of ships, transport vehicles and freight/charter hire payments thereto.

The High Court also opined that the scope of Section 194C covers carriage of goods and passengers, and freight payments are to be dealt with under Section 194C and not Section 194-I.

Hiring of taxi/car etc. is covered under 194C.


CA. O.P. Agarwalla

( Expert )
19 November 2007

CAN I GET THE REFERENCE OF jUDGMENT OR A SOFT COPY THEREOF? IF SOME BODY TAKE VEHICLE ON HIRE ON DAYS BASIS, HOW THE SECTION 194C CAN ATTRACT? THERE IS NO INVOLVEMENT OF WORK.
BEFORE GOING FOR FURTHER DISCUSSION, WE SHOULD HAVE A LOOK IN TO THE SAID JUDGEMENT.


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