Payment to sub - contractors for transportation of goods-Whether tax deductible under section 194 - C or section 194-I

Where the assessee had carried out freight and transportation works contracts with three transporters who transported the goods belonging to the assessee and its clients to various places through their vehicles, the assessee had not taken the trailers/cranes on hire or rent from the said parties. In fact, the assessee had given sub-contracts to the said parties for the transportation of goods and not for renting out of machineries and equipments. In the circumstances, the said transactions would fall within the purview of section
194C of the Act as the assessee was responsible for paying the amount in question for carrying out work in pursuance of contracts between the assessee and the transporters and as such was required to deduct tax at source at the rate prescribed under section 194C.-Vide CIT (TDS) v. Swayam Shipping Services (P) Ltd. (2011) 39 (I) ITCL 271 (Guj-HC)