Hire charges of plant/machinery and euipment covered by both

This query is : Resolved

Sumeet Agarwal (Querist)
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14 January 2012 As per Explanation to sec 194 I of the Act, Rent include any payment for the use of plant machinery and equipment.Further, With effect from July,2006 scope of 194 J has been extended to include royalty payment. As per explanation 2 to Section 9(1)(vi) , royalty include consideration for the "use or right to use any industrial , commercial or techanical equipment".
Thus, whether hire charges paid in relation to them are covered by Sec 194 I or 194 J?

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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14 January 2012 As I understand,

if any equipment is essential in the industrial unit it may be termed as forming part of Plant & Machinery.

Whereas an independent equipment can not be said as Plant &/or Machine. Because Plant is different from an equipment.
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Logically on the above ground TDS has to be deducted U/s 194-I only as it applies to Plant, Machinery and equipments, whereas royalty is applicable on " equipments" only.
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