23 June 2016
Truly replied by Ashwani, it would be applicable in case of partial payment in CASH for a transaction exceeding Rs.2Lacs...; effective 01.06.2016, every seller/provider of service who receives an amount in cash as consideration for sale of goods (other than bullion or jewellery) or providing any service, shall at the time of receipt of such amount in cash, collect from the buyer, a sum equal to 1% of sale consideration as income tax if the consideration exceeds Rs 2 lakhs. However, no tax is required to be collected if TDS has been deducted by the buyer/recipient of service on such payment.
Hence, in case following conditions are satisfied, tax @ 1% needs to be deducted by seller/provider of service:
There is a sale of any goods or any service (other than bullion or jewellery). Consideration for goods/service exceeds Rs 2 lakh Out of such consideration, any amount is received in cash. TDS is not deducted by the buyer of goods/recipient of service on such consideration.
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