Declaration Format for Non-Deduction of TDS on Transport Payments under Section 393(4)

Assessees making payments to transporters for plying, hiring or leasing goods carriages can avoid deduction of TDS where specific conditions in Section 393(4) of the Income-tax Act, 2025 are satisfied. For this purpose, the payer must obtain a properly executed declaration from the transporter confirming eligibility for the exemption.

This article provides a fresh, practitioner-friendly format of such a declaration, along with key compliance points that both the payer and transporter should keep in mind while relying on the non-deduction benefit.

Important: The declaration must be executed on ₹200 non-judicial stamp paper and duly notarized, as a best practice for evidentiary and compliance purposes.

Statutory framework

Under the scheme of the Income-tax Act, 2025, amounts paid to transporters for carriage of goods would ordinarily attract TDS. However, Section 393(1) read with Section 393(4) provides a specific carve-out where:

  • The payment is made for the business of plying, hiring or leasing goods carriages, and
  • The recipient-transporter satisfies certain ownership and other conditions laid down in Section 393(4)(a).

Where these conditions are met, and a valid declaration is obtained, the payer is permitted to not deduct TDS on such payments.

Key conditions under Section 393(4)

The exemption hinges broadly on the following aspects:

  • The recipient is in the business of plying, hiring or leasing goods carriages;
  • The transporter does not own more than ten goods vehicles at any time during the relevant financial year;
  • The amounts received are solely in respect of such eligible business; and
  • The transporter furnishes a declaration containing prescribed particulars, along with PAN and vehicle details, thereby enabling the payer to comply with Section 393(4)(a)(iii) and Section 393(4)(a)(iv).

In practice, payers are strongly advised to obtain a formal declaration in writing from each such transporter and preserve it as part of their TDS documentation.

Specimen Declaration Format (To be Executed on ₹200 Stamp Paper and Notarized)

Below is a revised, ready-to-use declaration format that assessees can adapt, ensuring that all statutory references remain intact. Placeholders may be customized based on the specific facts of each case.

Declaration for Non-Deduction of TDS on Payments for Plying, Hiring or Leasing Goods Carriages under Section 393(4), Income-tax Act, 2025
(To be prepared on ₹200 Stamp Paper and notarized)

To,
[Name of the Payer-Assessee]
[Complete Address with PIN Code]

Subject: Declaration for non-deduction of tax at source on payments made to transporter – Reg.

I/We, [Name of Transporter], Proprietor/Partner/Director of M/s [Name of Transport Concern], having our registered/office address at [Full Address], do solemnly state and declare as under:

1.