TDS on Transport of Pessangers

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CA.Tarun Maheshwari (Querist)
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05 October 2009 Dear Experts

I want to know whether the TDS is deductible or not for a transport agency which is exclusively engaged in transport of menpower in various corporates or tourists. As per the budget, TDS shall not be deductible for transport agencies if they provide their PAN Numbers. I just want to confirm whether such provision is applicable on goods transporters or is it pplicable on pessangers/tourists transporters also. Please reply soon and clear the picture of the amendment. Thanks in advance.

K V Subba Rao

K V Subba Rao (Expert)
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05 October 2009 Amendment is in relation to goods transport only (Ref: Para 159.7 of 32nd edition of Singhania's Ready Reckoner)

This reply is confined to amendment aspect only

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Shyam Lal Naik

Shyam Lal Naik (Expert)
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05 October 2009 The relevant sub section is reproduced below.

(6) 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.

It can be seen that, the above exemption is applicable only in the case plying etc. of goods carriage.

Hence, transportation of passengers is outside the purview of the captioned exemption.

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CA.Tarun Maheshwari

CA.Tarun Maheshwari (Querist)
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05 October 2009 Sir, this para has been the reason of my confusion. Can you please exactly give me some other clarification on this matter, as you are aware that ready reckoners do not have the clear explanations. It will a great help to me. And thanks a lot for your prompt reply.

Shyam Lal Naik

Shyam Lal Naik (Expert)
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05 October 2009 Sir,

The quoted para is unambiguous.

Further there is clear diferrence between "goods carriage", "stage carriage" and "tourist vehicle" under the Motor Vehicles Act, 1988.

The term "goods carriage" is used in respect of goods and / or commodity, whereas the terms "stage carriage" and "tourist vehicle" is used in respect of passengers.

The situation queried by you falls either under "stage carriage" and / or "tourist vehicle" and not "goods carriage".

In my humble view, the situation is well within the TDS net.

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CA.Tarun Maheshwari

CA.Tarun Maheshwari (Querist)
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05 October 2009 Thanks a lot to Nike Sir and Rao Sir.

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