Tds liability clarification

Bunty (123) (45 Points)

04 May 2018

Please clarifiy that a catering company hires bartan for an event, whether TDS liability would be applicable under 194C or 194H?

Thanks in advance

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7 Replies

PARESH SHAH (PARTNER) (126 Points)
Replied 04 May 2018

It is from 194c it is contract, not commission

Ajay (CA Job) (512 Points)
Replied 04 May 2018

Dear Bunty

In my opinion, this will fall u/s 194-I and TDS applicable @ 2%, this being hire charges for an "asset".

Regards

Ajay

Bunty (123) (45 Points)
Replied 04 May 2018

ajay i was also thinking that it would cover under sec 194- i but rate under this sec is 10% not 2% pls check and confirm.

Ajay (CA Job) (512 Points)
Replied 04 May 2018

Sec.194-I has two rates namely,

Rent of plant and machinery - 2%

Rent of land or building or furniture or fitting - 10%.

I think the "bartans" (utensils?) you have hired will fall under "plant" category and thus 2%.

Bunty (123) (45 Points)
Replied 05 May 2018

thanku...

Ashok J (CA Final) (880 Points)
Replied 05 May 2018

It should be under 194 I - rent. 194 I is a specific sec. if your transaction doesnt fit into 194 I then consider general section 194C.

Ajay (CA Job) (512 Points)
Replied 05 May 2018

PS. It needs to be deducted only if total payments to a single payee exceed Rs.1,80,000 in a year.

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