14 May 2014
TDS on hire charges of taxi/car charges can be covered under both section.Its all depends upon some issues:
1. 194 C 2. 194 I
To decide under which section it should be covered I have underlined some major points:
1. Taxi on specific job:when ever taxi or any other vehicle booked for a specific Job like giving a contract to take employees from home to office and office to home .In these type of work a specific job has been assigned to vehicle and vehicle has not been hired as such so it should be covered u/s 194C and not under section 194I
2. Control of owner of vehicle:In most of the time vehicles are hired with driver and control of the vehicle remain with the owner of the vehicle through driver,but this is not the deciding factor at all though its a point to be considered, whenever the control of vehicle remains with the the owner of the vehicle then it generally means that vehicle is specific job and not hired as such ,so deduction should be under 194C .but some times vehicle with drivers are also hired without specific jobs in that case person who has hired the vehicle can travel on it any where thought there may be some restriction but point is that no specific job has been assigned ,so in this case it will be covered under section 194-I
3. Contract agreement:The main paper which will decide the issue is contract agreement and issue will be decided mainly on the basis of the term of agreements and if there are slight differences from contract that can be ignored.
4. Running & maintenance :If running & maintenance expenses like petrol,repair etc has been incurred by the person who has hired the vehicle then we can say that it should be covered under section 194-I
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