Tds

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

07 January 2012 A transporter transports the goods for export from the place of exporter to the port of importer. The transporter raises the bills for the various services he provides for export of goods such as

- Custom clearence
- Custom clearence at destination
- Transit insurance
- Handling charges
- Terminal Handling charges
- Terminal Handling charges at destination
- GSP
- B/L fees
- Frieght
- ENS charges
- Local Haulage
- Management fees etc.
The querry is
1. whether the exporter is liable to deduct tax? If yes then at what rate?
2. If transporter furnishes PAN then is it necessary to made TDS?

CA Suraj Lakhotia

CA Suraj Lakhotia (Expert)
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08 January 2012 Section 194C(6) provides -

"No deduction shall be made from any sum credited or paid or likely to be credited or paid during the previous year to the account of a contractor during the course of business of "plying, hiring or leasing goods carriages", on furnishing of his Permanent Account Number, to the person paying or crediting such sum."

The exemption from TDS is only in case of contractors (transporters) in the business of plying, hiring or leasing of goods carriages.

In the given case, many services are provided in addition to plying or hiring of goods carriage.

In my opinion Tax has to be deducted at source. In case the contractor gives different bills for Freight and other charges, Tax needs to be deducted only for other charges.