Tcs u/s 206-c (1)

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

01 July 2016 Sir,

Kindly clear that the newly inserted section 206C(1) is applicable on all asseesee's and who get their books audited u/s 44AD below 1 Crore. It is clear to me that it is applicable on all audited firms

Rupesh Jain

Rupesh Jain (Expert)
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01 July 2016 its cover for 44AB audit ........

Querist : Anonymous

Querist : Anonymous (Querist)

01 July 2016 Sir Ji you mean to say Only 44AB and audit under 44AD is not applicable or out of this sections and everyone is out of this who has not get their books audited.

Querist : Anonymous

Querist : Anonymous (Querist)

05 July 2016 Sir Ji Still awaiting your answer that TCS 206C is applicable on 44AB and not on audit under 44AD and others Non-audit cases

Asha Kanta Sharma

Asha Kanta Sharma (Expert)
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26 July 2025 Got it! Here’s a clear explanation regarding **TCS u/s 206C(1)** and applicability on audit cases:

* **Section 206C(1)** applies to **all sellers**, regardless of whether the buyer's accounts are audited or not. The seller has to collect TCS if the transaction falls under specified goods or thresholds.

* Now, about the **audit under section 44AB** (regular tax audit) and **audit under section 44AD** (presumptive taxation scheme audit):

* The **TCS provisions under 206C(1)** are **linked with audit under 44AB**, meaning if the buyer’s turnover crosses the audit limit (and audit is done under 44AB), TCS collection is generally applicable.

* **Audit under 44AD** (presumptive audit) is treated differently — TCS applicability is not mandatory in such cases because the turnover is generally below the 44AB audit limit.

* So, **TCS u/s 206C(1) is generally applicable when the buyer's books are audited under 44AB**, and not applicable when audit is only under 44AD or no audit at all.

**In short:**

| Buyer’s Audit Status | TCS under 206C(1) Applicability |
| ------------------------------ | ------------------------------- |
| Audit under 44AB (Tax Audit) | Applicable |
| Audit under 44AD (Presumptive) | Generally Not Applicable |
| No Audit | Not Applicable |

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If you want, I can share some relevant CBDT circular references to support this. Would that help?

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