MILIND GUMASTE (AM) (108 Points)
18 December 2009Dear Friends
Non Deduction of TDS on transport contractors (in case PAN submitted)
applies to transporter plying,hiring or leasing goods carriges or it also extends to the contractors who rent their vehicles for carrying persons ??
e.g. whether No deduction of TDS extends to the transport contractor who is carring employees to and from their work place ??
Pl advise
Milind
CA.KUNJAR SHAH
(CA in Practice)
(61 Points)
Replied 18 December 2009
Dear Milind,
Good Morning.
The provision for non deduction of TDS shall apply only if one is engaged in business of plying, hiring or leasing of GOODS carriage and this only if he/she furnishes his/her Permanent Account Number. In turn, the person paying or crediting such sum to contractor shall furnish the requisite form(yet to be notified by the ITD) to the ITD. So it is always advisable to obtain PAN Card copy of such contractor to avoid unnecessary hassle.
Hope you get your answer.
Bye.
Lalit
(accounts)
(195 Points)
Replied 18 December 2009
For this purpose, transport operator is a person, who is in the business of plying, hiring or leasing goods carriage. Buses, cars, taxi etc. are not fall in the category of goods carriage hence TDS is deductible on the transporters who are in business of passenger vehicles even if they provide PAN.
Ashish
(CA)
(166 Points)
Replied 18 December 2009
Dear friend,
Neither the Income Tax Act nor the Finance Act has clasiffied Transportation between Goods and Human.
So, you can consider all type of Transport in this section.
In nutshell, no need of TDS in case transporter submit PAN.
Well Mr. Milind,
I think you mix two things together i.e., Transport business of Cab Business.
a). If contractor of Transport business (Carries goods) provides you PAN - No need to deduct TDS.
b). If contractor of Cab business (Carries persons for dropping or recieving) - Rule applicable 194C Payment to Contractors and TDS will be deducted as on this basis:
1). Individual/HUF - 1%
2). Any other Entity - 2%
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