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RENTING OF TATA HITACHI LIABLE TO GST

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HEMANTH RANKA

Tax & Financial Consultants

360 Points Posted on 04 May 2020

Whether Renting of Tata Hitachi for Agricultural purpose will be treated as supply of Agro Mahcinery SAC 9986 and hence the rent charges will be exempt or it is taxable?

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Quick Summary

This discussion explores whether renting Tata Hitachi machinery for agricultural purposes is subject to GST. It questions if it qualifies as a supply of agricultural machinery under SAC 9986, which would make the rent charges exempt. The conversation also touches upon Section 194I of the Finance Act regarding TDS on rent and seeks clarification on GST applicability and Input Tax Credit (ITC) availability.

Guest

Introduced by the Finance Act, 1994, the Section 194I states that any person, whether an individual or HUF who receives rent as income is liable for a tax deduction at source when the income credited is more than Rs.1,80,000 in the financial year. The limit is increased from Rs.1,80,000 to Rs.2,40,000 For FY2019-20. There is no surcharge unless the amount is more than Rs.1 crore. Rent paid to a government body/agency, its exempt from TDS.