Tds to be deducted on ind. trp'ter its not comes under 44ab

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

13 February 2016 DEAR FRIENDS,

IN SHORT, ABOVE SUBJECT LINE, WE ARE HIRED A PERSON,
(1)WHO LOOKS AFTER THE GOODS TO THE TRANSPORTED TO TRANSPORTER IF OUTSIDE CITY OR ELSE TRANSPORT THE GOODS IN THE CITY TO THE CUSTOMER PLACE FROM OUR FACTORY GATE.
NOW, PAYMENT PERSPECTIVE, MONTHLY BASIS HE GIVES BILL (WITH HEADING IN THE BILL "TRANSPORT CONTRACTOR", WHICH CROSSES SOMETIMES MORE THAN 30000,
REF: ITS NOT COMES UNDER STAX PREVIEW.(GROSS < 10 LAKHS)
QUERY: WHETHER TO DEDUCT OR NOT TDS ON THE BILL AMOUNT.
REPLY IMMEDIATELY
THANKS IN ADVANCE......

Querist : Anonymous

Querist : Anonymous (Querist)

16 February 2016 Waiting for reply from your ends.. my dear colleagues...

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
Follow

28 July 2025 Got it — here’s a clear answer for your query about **TDS on payments to an individual transporter not covered under section 44AB**:

---

### Scenario Recap:

* You hire an individual transporter.
* He issues monthly bills titled “Transport Contractor”.
* Payment sometimes exceeds ₹30,000 in a month.
* Gross turnover is less than ₹10 lakhs (so no service tax registration).
* You want to know if TDS is applicable on these payments.

---

### Key Points & Explanation:

1. **Which TDS section applies here?**

* Payments to transporters for transport of goods fall under **Section 194C (TDS on payments to contractors/sub-contractors)** of the Income Tax Act.

2. **Threshold for deduction under Section 194C:**

* TDS is to be deducted if the payment to a contractor exceeds:

* ₹30,000 in a single payment, or
* ₹1,00,000 in aggregate during the financial year.

Since you mentioned monthly bills sometimes exceed ₹30,000, TDS will be applicable.

3. **Does the transporter’s turnover or service tax registration affect TDS deduction?**

* **No.** TDS provisions are independent of Service Tax or GST registration or turnover.
* Even if the transporter is not registered under Service Tax or GST (because turnover is under threshold), you still need to deduct TDS as per Income Tax rules.

4. **Is the individual transporter required to be covered under Section 44AB (tax audit)?**

* No, the transporter's tax audit status does not affect your obligation to deduct TDS.
* Section 44AB relates to audit requirements for the assessee, not the payer’s TDS obligations.

---

### **Conclusion:**

* **Yes, you must deduct TDS under Section 194C on payments made to the individual transporter if the payment in a single transaction exceeds ₹30,000 or aggregate payments exceed ₹1,00,000 in the financial year.**
* The fact that the transporter is not covered under Section 44AB or is not registered for Service Tax does **not** exempt you from deducting TDS.
* Deduct TDS at the prescribed rates (usually 1% for individual/HUF contractor), deposit it with the government, and issue the TDS certificate.

---

If you want, I can help you draft the exact calculation and process for TDS filing for this case. Would that help?

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now