Tds u/s 194 c

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CA Santosh Dhumal (Querist)
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04 May 2014 A dealer from maharashtra state purchases material from Gujrat. on the invoice he is charging Rs 35000 as Transportation charges. so whether dealer in maharashtra is liable to deduction Tax at source u/s 194, though dealer in gujrat haf furnished his PAN. because as per sec 194 C, Payment to transporter is not liable to TDS u/s 194 C if covered u/s 44AE and furnish his PAN.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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04 May 2014 44AE is not relevant. however, 194c(6) only applies if the payment is being made to the transporter directly. If the seller is including transportation charges in his invoice itself, you will still have to deduct TDS.

CA Santosh Dhumal

CA Santosh Dhumal (Querist)
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05 May 2014 Sir is there any case law for the reference?

Nikhil Kaushik

Nikhil Kaushik (Expert)
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05 May 2014 Please read the section 194c

CA Santosh Dhumal

CA Santosh Dhumal (Querist)
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26 June 2014 But as per sec 194C(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".
here i want to highlight the line...During the course of business... means in my case supplier from Gujarat, providing transportation facility during the course of sale (Business) no deduction u/s 194C will be there, provided he furnish his PAN.

CA Santosh Dhumal

CA Santosh Dhumal (Querist)
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Nikhil Kaushik

Nikhil Kaushik (Expert)
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26 June 2014 Dear friend what you need to highlight is during the course of business of plying, hiring or leasing good carriage..

your seller is not the in the business of plying hiring or leasing goods carriage..he is in business of making the goods he sold you.

when he is making payments to the transporter, he gets covered under 194c(6). But not when you make reimbursement to the seller..

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