Tds under sec 194c
varsha bothra
(Querist) 20 December 2013
This query is : Resolved
One of our client is running rice mill in the Ass.Year 2009-2010 he hired truck from the Subcontractor having two trucks, the client could not deduct TDS by applying circular No. 3/2006 Dated 27.02.2006 & by following the provisions of sec.194(c) subsection 3, However the Assessing Officer disallowance the claim on the basis that our client is not contractor engaged in Business of plying, Hiring, leasing goods carriage infact he is rice miller. Our client has complied for all the formalities like for 15-I, 15-J. Our question is –
(1) Under Sec. 194C whether the contractor includes our client who is proprietary from & Rice Miller. If Yes, then how & why.
(2) Whether our contractor is correct that under subsection 3 of 194C, Our client is not required to deduct Tax at source.
R.K Nanda
(Expert) 21 December 2013
contact tax lawyer.
Anirudh
(Expert) 21 December 2013
That particular provision reads as under:
No deduction shall be made from any sum credited or paid or likely to be credited or paid during the previous year to the account of a contractor DURING THE COURSE OF BUSINESS OF PLYING, HIRING OR LEASING GOODS CARRIAGES, on production of .... IF SUCH SUB-CONTRACTOR is an individual who has not owned more than two goods carriages at any time during the previous year.
It is obvious that this provision is applicable only to that Contractor who is in the business of plying, hiring or leasing goods carriages. IT IS NOT AVAILABLE TO YOUR CLIENT, WHO IS NOT IN THE BUSINESS OF PLYING, BUT IN THE BUSINESS OF RUNNING A RICE MILL.
The ITO is right.
ajay sethi
(Expert) 21 December 2013
anirudh has resolved your query
T. Kalaiselvan, Advocate
(Expert) 21 December 2013
