LIVE GST Certification Course by CA Arun Chhajer begins 27th April. Register Now!!

Applicability of tds on C and F charges paid

Srinivas Reddy (CA , MBA) (59 Points)

02 February 2011

Dear all,

If a firm is availing the service of C & F agent, will tds be applicable on the payment regarding C & f charges to the party. Pls clarify.

Regards,

Srinivas

CA Final

Reply
Follow
Share

14 Replies

Pankaj Arora (Learner) (3134 Points)
Replied 02 February 2011

Yes tds will applicable u/s 194C.

CA ANKUSH AGGARWAL (CHARTERED ACCOUNTANT) (2782 Points)
Replied 02 February 2011

hi srinivas.yes Tds wud b deducted if a firm is availing c &f sevices u/s 194C

sudhir (Business Process Re engineering) (1083 Points)
Replied 02 February 2011

Yes tds will be applicable u/s 194C.

MITU.... (ARTICLE Assistant) (210 Points)
Replied 02 February 2011

YA TDS WILL BE APPLICABLE

caferoz (CA) (232 Points)
Replied 02 February 2011

It is applicable as stated above by various other members, but it is not applicable on certain charges.

Can you eloborate what are all the Charges C&F Agent shows in his bill.

Further what is the amount involved in payment?

ashoka r d (senior audit assistant) (82 Points)
Replied 02 February 2011

there will be no TDS provided the agent provides his PAN number

(Guest)

yes TDS will be applicable

(Guest)

yes tds will be deductable

Rahul (Other) (78 Points)
Replied 03 February 2011

TDS will be applicable on to the extent of incentive paid to Consingment agent for his services & not on the reimbursement of the expenses done by Consingment agent on behalf of Consignor .

sanjeev (student CA CS) (295 Points)
Replied 03 February 2011

yes c&f deductable

Sarita (Article) (154 Points)
Replied 03 February 2011

Yes, TDS will be applicable under section 194 C.

Rate of TDS:=

Individual/HUF = 1.00%

Any other person/company = 2.00%

CA. BIJENDER KR. BANSAL (ACA, B.COM) (8143 Points)
Replied 03 February 2011

Question 6 : Whether payment under a contract for carriage of goods or passengers by any mode of transport would include payment made to a travel agent for purchase of a ticket or payment made to a clearing and forwarding agent for carriage of goods ?

Answer : The payments made to a travel agent or an airline for purchase of a ticket for travel would not be subjected to tax deduction at source as the privity of the contract is between the individual passenger and the airline/travel agent, notwithstanding the fact that the payment is made by an entity mentioned in section 194C(1). The provision of section 194C shall, however, apply when a plane or a bus or any other mode of transport is chartered by one of the entities mentioned in section 194C of the Act. As regards payments made to clearing and forwarding agent for carriage of goods, the same shall be subjected to tax deduction at source under section 194C of the Act.

Question 7 : Whether a travel agent/clearing and forwarding agent would be required to deduct tax at source from the sum payable by the agent to an airline or other carrier of goods or passengers ?

Answer : The travel agent, issuing tickets on behalf of the airlines for travel of individual passengers, would not be required to deduct tax at source as he acts on behalf of the airlines. The position of clearing and forwarding agents is different. They act as independent contractors. Any payment made to them would, hence, be liable for deduction of tax at source. They would also be liable to deduct tax at source while making payments to a carrier of goods.

Circular : No. 714, dated 3-8-1995.

1 Like

CA. MOHAMMAD.QUSROO (CA FINAL) (81 Points)
Replied 03 February 2011

ya, i agree with CA. Rahul Saxena sir. TDS is not applicable for reimbursement of expenditure incurred by C&F agents on behalf of company, we have to deduct TDS on service of C&F agents services only.