TDS applicability on hiring on plant and machinery with vat

Sir,

In My View it is not Possible To Add VAT on Rent bill.Only Service Tax Will Charged.

I think Mr. Arun is correct. Sales Tax will not applicable for Rent, however service tax may be charged only and in this case TDS will be deducted on the amount excluding service tax.

As per haryana VAT ruling, anyone can charge the VAT of Hired Plant & machinery, Problem is that, what the TDS will be deducted on that.

As per article 366 of constitution sale also include tax on transfer of right to use any property whether for a specified period or not. Lease of plant & machinery is a deemed sale thats why Local VAT has been charged. You can deduct TDS on the bill cause ultimately you are using the service which comes under the purview of TDS.

Mr. Arjun Kumar TDS is applicable @ 2% under Sec. 194I State Vat matter will not change the Income Tax (Central Govt Tax) rules.

Circular No.4/2008 dated 28.04.2008 states that TDS is not to be deductible on service tax component on rent.The reason given by CBDT are that provisions of section 194-I requiers deduction of tax at sources on "any income by way of rent" therefore neither service tax nor vat should be included for TDS purpose.

Anjali Aswal - as you explain, but it is not mentioned in article whether it is direct tax or indirect tax.

please confirmed.

We have purchased boarding passes and received bill including VAT @ 5%

Do we too hve to add VAT while raising a bill to a party to whom we sell those passes.?

Originally posted by : CA Anjali Aswal
	As per article 366 of constitution sale also include tax on transfer of right to use any property whether for a specified period or not.

Although your solution is perfectly correct, just a little modification - It will be rather 'tax on the sale or purchase of goods includes......'

Sourav

Mr. Sandeep it is an indirect tax. It is covered in the VAT syllabus of C.A. Final. You take reference of book.

thanks sourabh

should add VAT @ 5% 

also under which accounting head both VAT input and VAT output should come?

TDS is not deducted on Bill amount if service tax charged, so deduct tds on net amount of rent.

OK  Anjali thanks ..........

@ ANUJ,

VAT IS APPLICABLE ON HIRING OF PALNT AND MACHINERY. DEDUCT THE TDS @ 194I @ 2% ON THE TOTAL BILL VALUE.