One of my clients is in manufacturing business. He purchases Raw materials from various suuppliers on "freight to pay basis" i.e. the freight burden is borne by the client and not the supplier.
Now the client says that there is no fixed transporter appointed by the supplier for the purpose. So when freight payment is made separately by the client, he does not know whether the total payment which he would make to that transporter during the year, go beyond Rs.50 thousand. So he is in a dilemma whether to deduct TDS u/s194C on the same or not.
Can this be a solution?? He need not deduct TDS on any transporter initially. But the moment the freight charges paid to any one goes beyond 50,000/-, he would deduct TDS in one go on the entire amount paid to him (transporter) till date.
There are no payments in excess of 20thousand at one time.
Please give your comments or any alternative solution to the problem.
Thank you.
CAclubindia
