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TDS U/S 194I or 194C

Sumit K. Garg (Article Assistant) (40 Points)

20 April 2010

Dear Friends,

If a company is paying Common Area Maintenance Charges to Mall Management in addition to the rent for showroom. company is liable to deduct TDS U/s 194C or 194I.

Waiting for ur valuable replies.

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13 Replies

Ratan Deep Saxena (Asstt Manager (Accounts & Finance)) (2998 Points)
Replied 20 April 2010

Dear Sumit,

If any payment is made towards repair & maintenance of building other than than rent of building the same should be liable to tax deduction U/s 194 I and not u/s 194C. Hence in your case area maintenance charge shall be liable to TDS u/s 194I.

regards,

ratan

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RITESH KOTHARI (B.COM, FCA, DISA(ICAI)) (778 Points)
Replied 20 April 2010

Yes, TDS is to be deducted u/s 194I.

CA Sanjay Jha (ACCOUNTS MANAGER) (914 Points)
Replied 20 April 2010

Dear Sumit

I am not agree with suggestion of Mr. Ratan

Because Repair and Maintenance is other than maintenance charge of mall management.

If we have to paid rent including maintanance charge then applicable 194I but if maintenance charge paid to other person as per agreement/contract then treat contractor.it is not a part of RENT

So in this case 194 C applicable.

Thanks

CA Mohit kumar jain (Searching Source of Money) (149 Points)
Replied 20 April 2010

i am also agree with sanjay

(Guest)

I Strongly Agree with Ratan,

Rent is defined any payment for the use of building, together with furniture,fittings,adjacent land etc.

The maintenance charges will have to be added to the rent paid by you to deduct tax.

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(Guest)

/experts/tds-deducted-on-rent-103206.asp

CA LOVELY ARORA (C.A. B.Com (H) Graduate) (2151 Points)
Replied 20 April 2010

agree with Mr. CA Sanjay........ TDS is to be deducted u/s 194C........... not u/s 194I.........

manish (Article Assitant) (358 Points)
Replied 20 April 2010

in my opinion, tds should be deduct u/s 194C. Because it's not the income of rent but it's the contract between both parties. so it should be deduct on u/s194C.

Ratti Wahal (Company Secretary) (139 Points)
Replied 21 April 2010

Dear Mr. Sumit,

As per Section 194 (I) of the Income Tax Act, 1961, Rent means any payment, by whatever name called under any lease, sub-lease, tenancy or any other agreement or arrangement for the use of (either separatlely or together) any,

a) Land, OR

b) Building......................

In my opinion, TDS will be deducted under Section 194I only when payment of Maintenance Charges to the Mall Management was expressly stated in the Rent Agreement executed.

Regards,

rajesh bhandari (service) (41 Points)
Replied 21 April 2010

In my opinion ;

***If you are showing the expenditure of building maintance under head of rent than only TDS ded u/s 194I

** if you are showing the expenditure as repair and maintance of building in your books than you can ded u/s 194c.

RAJESH BHANDARI

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sanjay jha (service) (99 Points)
Replied 21 April 2010

Dear all ,

1. plz check lease deed if lease deed expressing the word rent for common area maintenance then deduct TDS u/s 94I other wise TDS U/s 94C,

2. if MOU expressing the rent and chagres separatly then seprate both individually, i e for rent 94i and for all charges 94 C.

Thanks

Sanjay Jha

Originally posted by : rajesh bhandari
	In my opinion ; *If you are showing the expenditure of building maintance under head of rent than only TDS ded u/s 194I if you are showing the expenditure as repair and maintance of building in your books than you can ded u/s 194c. RAJESH BHANDARI

amit (Audit Assistance) (43 Points)
Replied 21 April 2010

For application of TDS accouting treatment in the books of accounts is not musch important.

Application of TDS is fully depend upon the nature of payment.

Hence, according to the above points it can be concluded that if maintenence charges paid according to the agreement of lease then TDS u/s 194I is applicable, if it is to the addition of the rent which is not covered under agreement then lible for TDS u/s 194C.

Thanks

Amit Jha

V.Sathyanarayanan (Senior Accountant) (109 Points)
Replied 23 February 2012

Dear Mr. Sanjay Sir,

We are paying rent of the show room to the MALL owner as well as the Common area maintenance charges also paid to the same MALL owner only. So in this situation at what rate under which section should i deducte TDS on Common area maintenance?