Applicable section of tds

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Querist : Anonymous

Querist : Anonymous (Querist)

14 March 2012 A crane is hired by a manufacturing unit. Rent is paid to the owner of the crane which exceeds Rs.1,80,000. TDS u/s 194 I will be applicable here. Will the section change to 194 C if the crane is hired on:-
(i) Hourly basis
(ii) Day basis
(iii) Trip basis
(iv) Monthly basis

CA Siddhartha Bhardwaj

CA Siddhartha Bhardwaj (Expert)
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14 March 2012 Section 194I applies to payment of rent.

Rent is defined as any payment made for the use of, inter alia, any machinery or equipment.

Accordingly TDS shall be deducted u/s 194I only.

The same will also hold true if the crane is hired on hourly, daily, trip or monthly basis.

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Querist : Anonymous

Querist : Anonymous (Querist)

14 March 2012 Should the amount of rent be fixed because when the Crane is hired on Hour basis the amount is not fixed. It depends on the number of hours the crane has worked. Will that make any difference?

Dintakurthi Tirumala

Dintakurthi Tirumala (Expert)
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14 March 2012 If you charge hire charge on daily,monthly,hourly,trip basis at what ever rate it would be deduct TDS under section 194I only. otherwise crane hired for complete of some work for Ex. crane hired to load say 1000 tonnes of material into ship irrespective of the time taking and charged some amount for such work these type of agreements is called contract and TDS would be liable under section 194C.
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