Tds deductible or not
This query is : Resolved
16 September 2014
Sir,
I need to Rs.31,000 one time payment to a party for hiring of vehicle. The amount Rs. 31000 is inclusive of service tax of rs.3410. on base value of 27590.
Whether TDS will be deducted on this??
Please reply
I need to Rs.31,000 one time payment to a party for hiring of vehicle. The amount Rs. 31000 is inclusive of service tax of rs.3410. on base value of 27590.
Whether TDS will be deducted on this??
Please reply
16 September 2014
no tds is dductible as the threshold limit of rs 1,80,000 is not crossed as this is only a 1 single transaction
16 September 2014
IT WILL FALL UNDER 194C OR 194I. IT IS ONE TIME HIRING OF TAXI FROM ONE PLACE TO ANOTHER.
16 September 2014
as said that for rent sec 194I is applicable only if abovementioned threshold limit is crossed else not
16 September 2014
First of all will it fall under 194c or 194I that needs to be decided.
To decide under which section it should be covered we have underlined some major points
Taxi on specific job:when ever taxi or any other vehicle booked for a specific Job like giving a contract to take employees from home to office and office to home .In these type of work a specific job has been assigned to vehicle and vehicle has not been hired as such so it should be covered u/s 194C and not under section 194I
Control of owner of vehicle:In most of the time vehicles are hired with driver and control of the vehicle remain with the owner of the vehicle through driver,but this is not the deciding factor at all though its a point to be considered,whenever the control of vehicle remains with the the owner of the vehicle then it generally means that vehicle is specific job and not hired as such ,so deduction should be under 194C .but some times vehicle with drivers are also hired without specific jobs in that case person who has hired the vehicle can travel on it any where thought there may be some restriction but point is that no specific job has been assigned ,so in this case it will be covered under section 194-I. Same has been held by Chattisgarh State Electricity Board vs. ITO (ITAT Mumbai) Read more: http://www.simpletaxindia.net/search/label/SEC%20194%20I#ixzz1x4FT2b4U
Contract agreement:The main paper which will decide the issue is contract agreement and issue will be decided mainly on the basis of the term of agreements and if there are slight differences from contract that can be ignored.TDS on hired vehicle for fixed amount is covered under section 194C and not section 194I.(read case law here)
To decide under which section it should be covered we have underlined some major points
Taxi on specific job:when ever taxi or any other vehicle booked for a specific Job like giving a contract to take employees from home to office and office to home .In these type of work a specific job has been assigned to vehicle and vehicle has not been hired as such so it should be covered u/s 194C and not under section 194I
Control of owner of vehicle:In most of the time vehicles are hired with driver and control of the vehicle remain with the owner of the vehicle through driver,but this is not the deciding factor at all though its a point to be considered,whenever the control of vehicle remains with the the owner of the vehicle then it generally means that vehicle is specific job and not hired as such ,so deduction should be under 194C .but some times vehicle with drivers are also hired without specific jobs in that case person who has hired the vehicle can travel on it any where thought there may be some restriction but point is that no specific job has been assigned ,so in this case it will be covered under section 194-I. Same has been held by Chattisgarh State Electricity Board vs. ITO (ITAT Mumbai) Read more: http://www.simpletaxindia.net/search/label/SEC%20194%20I#ixzz1x4FT2b4U
Contract agreement:The main paper which will decide the issue is contract agreement and issue will be decided mainly on the basis of the term of agreements and if there are slight differences from contract that can be ignored.TDS on hired vehicle for fixed amount is covered under section 194C and not section 194I.(read case law here)
16 September 2014
in any of your earlier reply have u mentioned about any agreement? then in such case its always assumed to be covered under section 194I, its a request to you that while posting the initial query all the details must be given at one place only
for giving correct suggestion as only on limited detail u asking for a debate?
for giving correct suggestion as only on limited detail u asking for a debate?
16 September 2014
in this case, after additional facts presented by querist, 194C shall apply.
16 September 2014
Details are like this:
1. A firm hired a car for going to a specific place and total KM run is suppose 2153 Km and car stayed with company employee for 8 nights.
Total one time payment to be made is as follows:
2153 Km @ Rs.12 = 25840
8 nights @ 200 = 1600
Total = 27440
Add: Service Tax= 3392
Now my question is whether TDS will be applicable u/s 194C or 194I, and if applicable u/s 194C whether TDS will be deductible as the base amount is less than Rs.30000. I hope now you are clear about my query???
1. A firm hired a car for going to a specific place and total KM run is suppose 2153 Km and car stayed with company employee for 8 nights.
Total one time payment to be made is as follows:
2153 Km @ Rs.12 = 25840
8 nights @ 200 = 1600
Total = 27440
Add: Service Tax= 3392
Now my question is whether TDS will be applicable u/s 194C or 194I, and if applicable u/s 194C whether TDS will be deductible as the base amount is less than Rs.30000. I hope now you are clear about my query???
16 September 2014
yes then in such case sec 194C is applicable as it falls within the definition of "works contract" u/s 194C however still it does not cross the threshold limit of Rs 30,000 for 1 time transaction as stated and hence no tds will be deducted.
Hope now my reply is acceptable to u on ur details as provided above.
Hope now my reply is acceptable to u on ur details as provided above.
Message likes :
1 times
16 September 2014
I agree to your point, but I need to convince my boss that the threshold limit as of Rs.30000 is exclusive of service tax. No where it is mentioned.
In book it is mentioned "tax is required to be deducted at source where the amount credited or paid exceeds Rs.30000. in a single payment.
In book it is mentioned "tax is required to be deducted at source where the amount credited or paid exceeds Rs.30000. in a single payment.
16 September 2014
dear bibek,
refer to circular 1/2014 issued by CBDT this year. after this circular, service tax amounts are not to be considered for TDS deductions. It is natural to extrapolate this to say that service tax is not to be included in computing the threshold limits
refer to circular 1/2014 issued by CBDT this year. after this circular, service tax amounts are not to be considered for TDS deductions. It is natural to extrapolate this to say that service tax is not to be included in computing the threshold limits
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Treatment of Proceeds from sale of Jointly held Flat
- Refund of return filed for deceased
- TDS Under Section 194IA Where More than one Buyer and More than one Seller
- Interest on Capital-Partnership Firm
- LTCG loss on delisted shares
- ISSUANCE OF TAX INVOICE IF CAR/BIKE SOLD SHOWN IN FIXED ASSET
- ITC claim of capital goods
- Insolvency and Bankruptcy code 2016
- Regarding Itr Filing
- ABOUT RE-OPENING OF CASE
- STCG.........
- 80G deduction eligibility
- GST on Tobacco - as per new notification
- Cant amend a 26QB
- "Please ensure that the Total of the Deductions u/s 54F match the same in Table D in Sch CG"
- Composition Dealer GST Annual Return Filing process
- TDS under section 195.
- Filing GST Returns after death of proprietor
- Registered Required in GST Act
- Switch over to Composition Scheme
Trending Online Classes
-
Online GST Course - Master the Fundamentals of GST with Practical Insights
Ruhi Joshirao19 January 2026
CAclubindia
