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Tds 194 ia (on property)

04 January 2018

Sir

My client a private limited company is going to buy 7 flats from builder. Prices of all flats are less than 50.00 lacs. say 44.00 lacs. Hence total consideration Rs 308.00 lacs (44*7).

whether 194 IA is attracted.

In my opinion, the value of each property does not exceed Rs 50.00 lacs hence this section has no application. even if total consideration exceeds Rs 50.00 lacs

Please confirm

Thanks

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2 Replies

CA Rakesh Ishi (Working at Private Company) (7995 Points)
Replied 04 January 2018

Conditions to be satisfied for applicability of section 194-IA:

The payer must be any person referred to in section.
The payee must be a resident transferor of an immovable property (other than agricultural land).
The payment must be by way of consideration for transfer of any immovable property (other than agricultural land).
The quantum of payment must be Rs. 50 lakhs or more.

Prajjwal Kaushik (Finance Professional) (6216 Points)
Replied 04 January 2018

In my opinion, TDS provisions would apply in the instant case.

In case there are more than 1 properties and the individual pp of each property is less than Rs. 50 Lacs, but the aggregate value of the transaction exceeds Rs. 50 Lacs, in such cases 194IA would be applicable and the TDS on the property would be required to be deducted and deposited with the govt.