<s>[INST] How to deduct tax at source under section 194-I in case the building is let out along with machinery or other equipment? [/INST] The rental proceeds are considered as composite rent in case other assets such as plant, machinery, or equipment are also let out along with land or building. The tax deduction in such case would be as under:

 (a) If there is a separate agreement for letting out of land or building and letting out of other assets:

 The tax shall be deducted at the rate of 10% from the payment of rent of land or building and 2% from the rental payment of machinery, plant, or equipment.

 (b) If there is no separate agreement for letting out of land or building and letting out of other assets:

 The tax shall be deducted at the rate of 10% or 2% depending upon the substantial element of the rent agreement. If the renting of machinery, plant, or equipment is incidental to the renting of land or building, tax shall be deducted at the rate of 10%.​ </s>