05 April 2015
We have one transporter and we have an agreement to pay fixed amount 85000/month for supplying 11 vehicles/month. He submits bill along with LR copies. even if he didn't supply of 11 vehicles we have to pay full amount. my question is in this case we have to deduct tds > contract or pay GTA > LR copies else both? Please clarify
05 April 2015
Provision of section 194C attracted.
Upto 31.05.2015 if the transporter provides PAN TDS not required to be deducted. If PAN not provided 20% TDS will have to be deducted.
Changes effective from 01.06.2015 in line with amendments vide Budget 2015:
It is proposed to amend the provisions of section 194C of the Act to expressly provide that the relaxation from non-deduction of tax shall only be applicable to the payment in the nature of transport charges (whether paid by a person engaged in the business of transport or otherwise) made to an contractor who is engaged in the business of transport i.e. plying, hiring or leasing goods carriage and who is eligible to compute income as per the provisions of section 44AE of the Act (i.e. a person who is not owning more than 10 goods carriage at any time during the previous year) and who has also furnished a declaration to this effect along with his PAN.
This amendment will take effect from June 1, 2015.
18 May 2015
Sample Declaration u/s 194C(6) for non-deduction of tax at source.
To,
__________ (name of the Payer)
__________ (Address of the Payer)
Declaration
I, ________, Proprietor / Partner / Director of M/s _________________ (name and address of Payee) [hereinafter “the contractor”] do hereby makes the following declaration as required by sub section (6) of Section 194C of the Income Tax Act, 1961 for receiving payments from the payer without deduction of tax at source:-
1. That I/We am/are authorized to make this declaration in the capacity as proprietor/partner/director.
2. That the contractor is engaged by the payer for plying, hiring or leasing of goods carriage* for its business.
3. That the contractor does not own more than 10 goods carriage* as on date.
4. That if the number of goods carriages* owned by the contractor exceeds ten at any time during the previous year 2015-16 (i.e. 01.04.2015 to 31.03.2016) or after furnishing this declaration, the contractor shall forthwith, in writing intimate the payer of this fact.
5. That the Income Tax Permanent Account Number (PAN) of the contractor is ____________ . A self-attested photocopy of the PAN is furnished to the payer along with this declaration.
Place : ______
Date : _______ (Name of Declarant)
Verification
I, the above named declarant do hereby verify that the contents of the above paragraphs one to five are true to the best of my knowledge and belief, and no part of it is false and nothing material has been concealed in it.
Place :
Date:
(name of Declarant)
* Goods Carriage” means any motor vehicle constructed or adapted for use solely for the carriage of goods, or any motor vehicle not so constructed or adapted when used for the carriage. [Explanation (a) to subsection (7) of Section 44AE read with Explanation (ii) of Section 194C and Section 2 of the Motor Vehicles Act, 1988.]
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