Tds on transporter

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CMA Swati Agarwal (Querist)
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08 July 2015 We have hired a transport agency for transport of material from a godown to our plant. The agency does not have vehicle of its own, It hires from the individuals having vehicles.
In this case do we need to deduct any TDS under 194C or not?

Thanks

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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08 July 2015 yes you need to deduct TDS u/s 194C.

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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08 July 2015 still there is ongoing confusion regarding vehicle should be only owned or even the hired vehicles are covered under tds web u/s 194C but looking at liberal view the dep must have considered this fact that most of them are hired and onwed also includes beneficial ownership of hiring.

CMA Swati Agarwal

CMA Swati Agarwal (Querist)
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08 July 2015 Dear Sir,
If the transporter declares, that he does not have any vehicles owned, how can we deduct TDS?

Requested to guide

CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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08 July 2015 as said ownership includes beneficial ownership i.e hiring vehicles and if he declares he hires less then 10 vehicles then no tds u/s 194C

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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08 July 2015 Deduct TDS as the condition for non deduction is a declaration of not owning more than 10 vehicles.

CMA Swati Agarwal

CMA Swati Agarwal (Querist)
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08 July 2015 Dear Seetharam Sir,

The transporter has given the declaration that he does not own any vehicle, so how can TDS be deducted

CA John Abraham Austin ACA

CA John Abraham Austin ACA (Expert)
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08 July 2015 It is the nature of payment you need to consider. Not the ownership of the property help by him. Hence, if the single bill exceeds Rs. 30K or aggregate payment exceeds Rs. 75K, you will have to deduct TDS.

Even if he does not own a vehicle in his name, if the payment is of the nature specified therein, you will have to do TDS.

Here, the theory of 'beneficial ownership' does not apply since he acts as an agent/ subcontractor.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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08 July 2015 Deduct TDS u/s 194C. Non deduction available only to vehicle owners not owning more than 10 vehicles and eligible for presumptive taxation u/s 44AE.

CA John Abraham Austin ACA

CA John Abraham Austin ACA (Expert)
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08 July 2015 Its not non deduction, its exclution from deduction.
W.e.f this PY, TDS to on payment GTA is exempt only if the person files a declaration with you that he owns less than 10 vehicles only (So as the interests of presumptive tax payers u/s 44AE is considered).

Earlier, only submission of PAN by the GTA was sufficient.

Here, in my opinion, you should do TDS if threshold is exhausted.

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