PLEASE EXPLAIN SECTION 194Q

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CA SASHI KANT SHARMA (Querist)
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06 July 2021 Dear Expert,
Whether TCS Credit will be denied if I charge TCS on sale bill to buyer, if declaration is given by buyer. Please explain Section 194Q.

CMA Poornima Madhava

CMA Poornima Madhava (Expert)
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06 July 2021 What kind of declaration?
Buyer is primarily required to deduct tax at source u/s 194q

CA SASHI KANT SHARMA

CA SASHI KANT SHARMA (Querist)
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06 July 2021 i have already charged TCS on bill, whether that TCS credit Will be denied to buyer due to applicability of section 194Q

CMA Poornima Madhava

CMA Poornima Madhava (Expert)
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06 July 2021 No, as per the recent clarification by CBDT, if tax is collected by the seller, then the buyer is not required to deduct tax again. So TCS credit should be available to the buyer in this case.

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CA SASHI KANT SHARMA

CA SASHI KANT SHARMA (Querist)
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06 July 2021 Thank you Poornima mem for your reply, please solve my doubt , My Company already charged Tcs on Bill after 1 july, Whether that TCS Credit will be denied to Buyer because buyer is required to deduct TDS at the time of payment or credit Which ever is earlier .

CA SASHI KANT SHARMA

CA SASHI KANT SHARMA (Querist)
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06 July 2021 Thank you Poornima jii for your reply

Deepa B

Deepa B (Expert)
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06 July 2021 If on bills dated after 1.7.2021, TCS has been charged by you then the buyer is not required to deduct tax on the same transaction u/s 194Q. Because Section 194Q and Section 206C(1H) operate in a mutually exclusive way. Credit of TCS will definitely be available to buyer as the tax collected is legitimately remitted to the authorities.

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Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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11 October 2021 As per the explanation given by CBDT.... from 01.07.2021 Sec. 194Q overrides sec. 206C(1H)

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