Tds under 194 c or 194 i under this case is deducted

This query is : Resolved

Rupali Kabra (Querist)
Follow

02 October 2012 sir,

suppose a client x (pvt ltd co.) is providing trucks on rent basis by making contract of 3 years with a company y(pvt ltd co), now

1-whether y co while making payment of rent every month will deduct tds of x co under section 194 c @ 2% or

2-whether y co will deduct tds of x co under section 194 i @10%
whether contract or rent which basis?
also does section 194 I covers all types of ,rents, or it has some limitation if any reference of case law can be provided it will be great help

SANJAY TALATI

SANJAY TALATI (Expert)
Follow

03 October 2012 IN the given case , the contract is for the renting of the trucks and hence the provisions of sec. 194 I will get attracted. Applicable TDS rate is 2%.

Explanation to Sec. 194 I provides that besides on land & building , tax shall be deductible for leasing or hiring of machinery, plat, equipment, furniture & fittings whether or not owned by the payee.

Prakash Kochar

Prakash Kochar (Expert)
Follow

03 October 2012 Agreed with Mr. Talathi as this is rent agreement.

Rupali Kabra

Rupali Kabra (Querist)
Follow

05 October 2012 but sir provision of 194 i covers only two types of rents
one is rent of plant & machinary
second is of building & furniture etc
for both of above rates are also fixed in 194 i does it not prove that section is not applicable to any other cases than above two
it is only applicable to p&m or building & furniture
for p& m rate is 2 %
for building & furniture rate is 10%

Rupali Kabra

Rupali Kabra (Querist)
Follow

05 October 2012 in this case item is trucks which is not covered by any of two above

SANJAY TALATI

SANJAY TALATI (Expert)
Follow

06 October 2012 Under the Income Tax Act, vide sec. 2(11) all assets are grouped in the Blocks.

All eligbile assets are classified into five classes :

(1) Building
(2) Furniture
(3) Plant & Machinery
(4) Ships
(5) intangible assets

Block of Plant & Machinery covers
Motor Cars, motor Buses, Commercial Vehicle etc.
Thus, by implication for the purpose of TDS u/s 194 I Vehicles is to be categorised under the head Plant & Machinery.

Message likes : 1 times

Prakash Kochar

Prakash Kochar (Expert)
Follow

06 October 2012 Truck is covered under plant as explained by Mr. Talti, TDS will be applicable @2% u/s. 194I.

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

Join the CA Students WhatsApp Community for ICAI Updates, Trending Courses & Notes!

Similar Resolved Queries

Unanswered Queries

Popular
Recent

Trending Online Classes

Direct Tax Laws & International Taxation May 26,Sept 26 & Jan 27

CA Arvind Tuli

Enroll Now
Audit Fast Track Recorded Batch For May 26,Sept 26 & Jan 27

CA Aarti Lahoti

Enroll Now
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English

CA Bhanwar Borana & CA Shubham Keswani

Enroll Now

view all classess

Meet our CAclubindia PRO Members

Jagdeep Kaur

RAVINDRA JOSHI

Jaipal Singh

AJAY Kumar Agrawal

CA K GIRIDHAR

Subscribe Now

Tds under 194 c or 194 i under this case is deducted

Similar Resolved Queries

Trending Online Classes

Meet our CAclubindia PRO Members

Quick Links

Browse by Category

Latest Job Openings

Senior Executive

Manager- Finance and Compliance

GST CONSULTANT

GST CONSULTANCY

Accountant

CA Final

Article Assistant

Associate CA