914 i vs 194 c

This query is : Resolved

CA Aditya (Querist)
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30 December 2013 Dear All,

Please confirm on the following:

Car Hire Charges:
We have taken a car for hire from a subsidiary company against which fixed rentals will be paid . Driver, Fuel , Maintenance taken care by the Holding company, Subsidiary gets only monthly rentals now is it 194 I 0r 194 C.

2. Rentals for photo copier machine:

We have hired Photo copier machine. As per the contract owner gets amount like 0.25 per copy, cartridge gives by owner and parer provides by company. Now is it 194 I or 194 C for company.

I know tax rate is 2% but still matter of select correct code I am asking.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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30 December 2013 I would say rental in case one. can contract in case 2.

CA Pallav Singhania

CA Pallav Singhania (Expert)
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30 December 2013 TDS under section 194 I in case one..
TDS under section 194C in 2...

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CS,CA F,Numrologi TusharSampat

CS,CA F,Numrologi TusharSampat (Expert)
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30 December 2013 Agreed with above experts view.

CA Aditya

CA Aditya (Querist)
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31 December 2013 Thanks all of you for inputs.

But it would be highly appreciated if provide the relevant support material.

Nikhil Kaushik

Nikhil Kaushik (Expert)
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31 December 2013 see in case 1, you are taking a vehicle on rent with a fix rental amount and rest all the expenses are yours. It is more in the nature of rent. therefore 194I. In this case had you took the vehicle on the basis of payment for per km, it could have been considered as 194C.

Whereas in case 2, the payment is more or less linked to the usage (per paper payment), which assumes nature of a contract. Therefore 194C.