TCS ON SALE OF GINNING MACHINERY AS SCRAP
This query is : Resolved
Allauddin Patel
(Querist)
09 August 2026
My question is
Do we need collect tcs if we sell our old ginning machinery as scrap ??
Do we need collect tcs if we sell our old ginning machinery as scrap ??
09 August 2026
TCS is generally NOT required — Section 206C(1) covers scrap arising from manufacturing, and old ginning machinery sold as scrap is a capital asset disposal, not process scrap. Several tribunal rulings support this view.
Caution: It's a litigated/interpretational area — some sellers still collect TCS conservatively if the buyer is a scrap dealer (no real cost to buyer since it's creditable).
If not collecting TCS, keep documentation (asset register, depreciation record, sale authorization) showing it was capital machinery, not manufacturing scrap.
Separately check: Section 194Q (TDS by buyer, if turnover >₹10 cr) and GST on the scrap sale — both are independent compliance points.
Caution: It's a litigated/interpretational area — some sellers still collect TCS conservatively if the buyer is a scrap dealer (no real cost to buyer since it's creditable).
If not collecting TCS, keep documentation (asset register, depreciation record, sale authorization) showing it was capital machinery, not manufacturing scrap.
Separately check: Section 194Q (TDS by buyer, if turnover >₹10 cr) and GST on the scrap sale — both are independent compliance points.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Opting out" of regime provided under subsection (1A) of Section 115BAC but Form 10IEA is not filed.
- "Please ensure that the Total of the Deductions u/s 54F match the same in Table D in Sch CG"
- Need to correct "Whether it is last installment " response in Form 26 QB
- " Income from House Property " in joint names of co-owners
- REGARDING TDS RETURN OF FORM 27Q
- Notice under e-Verification Scheme
- GST demand notice for ITC reversal against exempted supply.
- RCM ON SECURITY CHARGES FROM INDIVIDUALS
- How to get money back from delisted company
- ITC not to be taken in accounts & GSTR-3B
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
