Sale of waste / used oil

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Querist : Anonymous (Querist)

13 March 2014 Please confirm applicability of TCS against sale of waste/ used oil

Querist : Anonymous

Querist : Anonymous (Querist)

13 March 2014 dear Sir,

pl help

Aashok Kumar Sharma online

Aashok Kumar Sharma online

(Expert)
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23 July 2025 Regarding **TCS (Tax Collected at Source) applicability on sale of waste/used oil**, here’s the summary:

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### 1. **Is TCS applicable on sale of waste/used oil?**

* **TCS is applicable on the sale of scrap**, as per **Section 206C(1H)** of the Income Tax Act, 1961.
* Waste/used oil is generally considered as **scrap** or **waste material**.
* Therefore, if you sell waste or used oil, **TCS @1% (currently) may apply** on the gross sale value, provided:

* The buyer is a **resident individual or Hindu Undivided Family (HUF)**.
* The **sale amount exceeds Rs. 50 lakhs in a financial year** (threshold limit).

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### 2. **Key points**

* TCS is collected by the seller from the buyer.
* The threshold limit is **Rs. 50 lakhs** of aggregate sales of scrap to the buyer in a financial year.
* If the buyer is a **company or other entity**, TCS may not be applicable under this provision, but you should verify based on latest amendments.
* Waste/used oil sold as scrap falls under this provision.

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### 3. **Practical implication**

* If your sale of waste/used oil to a particular buyer exceeds Rs. 50 lakhs in a financial year, you must collect 1% TCS on sale proceeds.
* Deposit TCS to government and provide TCS certificate to buyer.

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If you want, I can help with drafting a TCS invoice format or explain filing procedures for TCS. Would you like that?

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