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TDS on rent of Mobile Advertisement Vehicle

prachi (manager finance) (31 Points)

08 April 2009

what is the rate at which TDS to be deducted for hire charges of mobile hoarding van used for advt of product at prominent junctions? will it fall under the category Rent of Plant & Machinery or under other rents?

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2 Replies

Ramakrishna (Financial Executive) (438 Points)
Replied 10 April 2009

Dear Prachi!

As per the explanation to the term 'work' given under Section 194C, carriage of goods by any mode of transport other than by railways is covered under 194C.

However, in this case, as it has to be used for the purpose of advertising, the entire vehicle itself has to be hired and suitably dressed up to meet the specific task of mobile advertisement. What needs to be seen that the vehicle has to be placed at the disposal of the user for appropriate modifications in its appearance and not merely used for the purpose of carriage of any goods or passengers.

Therefore, it appears that the payment would be covered under Section 194I as rent.

Do post your response!

Good Bye! Cheers!!

Deepesh Ashwin Shah (Chartered Accountant) (141 Points)
Replied 11 April 2009

hi,

First we need to understand that wherther we are takin on rent the vehicle or the place?. as i understand that we are takin on rent "the place" and not "the machine " on which my hoarding is standing.

also applyin the ratio of --to take on hire a car, we apply sec 194C and not 194I i.e. rent.

thus, to conclude, i will advise to apply nornal rates of rent and not the of rent on plant and machinery.

trust this is helpful for you.