Tds on warehouse management charges

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Querist : Anonymous

Querist : Anonymous (Querist)

21 February 2012 We have warehouses at different location and provide warehouse management services to our client. it includes transportation, loading, unloading, packing, distribution on behalf of client. it means we are not only letting out warehouse but also providing other services. now, question is TDS rate on above. above payments whether covers under 194C or 194I. pls suggest with justification.

thanks in advance

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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21 February 2012 If you provide the different bills for hire & other services, the TDS applicable different section. Hire- u/s.194I & other services-194C

if combined bills then only one section 194I apply for total bills

Querist : Anonymous

Querist : Anonymous (Querist)

22 February 2012 In above case essence of the service is not letting out the warehouse but it is overall management of the warehouse, so i think 194 I is not applicable, this rather 194 C. if we segregate (on rational basis)the total bill amount than warehouse rent goes only to 20% of the total bill amount. thus covering entire bill under 194 I is not justify and also as per circular 715/1995 clarifies that when composite agreement is in essence of the tenancy agreement only than 194 I is applicable.

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Querist : Anonymous

Querist : Anonymous (Querist)