TDS ON PROPERTY

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This discussion addresses the applicability of Tax Deducted at Source (TDS) on a property sale where payments were made to siblings in 2011, but the sale deed was executed in December 2019. The key issue is the registrar's request for TDS challans despite the TDS on property provisions only becoming effective from June 1, 2013. The query explores potential interest liabilities and the correct date for TDS deduction, suggesting that since the section was not active in 2011, TDS should ideally be based on the 2019 sale deed date. It also touches upon the possibility of obtaining permission for no TDS from the Assessing Officer in cases of genuine hardship.

shalini

shalini (Querist)

19 February 2020 TDS on property became effective from 1.6.2013. A person paid his brothers & sisters in 2011 to purchase their share in the ancestral property he resided. Now in Dec 2019 he has got a sale deed executed in his favour and Registrar is asking for TDS challans for it. He is ready to pay TDS, what would be applicability of interest if date of payment of 2011 is entered. Since the section was not effective, there should be no TDS. Date of deduction is also got to be entered it will be Dec 2019.
Pls help out in this matter.

Shrikant Toshniwal

Shrikant Toshniwal (Expert)

19 February 2020 TDS is applicable on sale of immoveable property wherein the sale consideration of the property exceeds or is equal to Rs 50,00,000 (Rupees Fifty Lakhs). Sec 194 IA of the Income Tax Act, 1961 states that for all transactions with effect from June 1, 2013, Tax @ 1% should be deducted by the purchaser of the property at the time of making payment of sale consideration

Amol S Joglekar

Amol S Joglekar (Expert)

19 February 2020 You can take the permission from the Assessing Officer for NO TDS

Shrikant Toshniwal

Shrikant Toshniwal (Expert)

22 February 2020 Mr amol under which section did A.O allow for no tds

Amol S Joglekar

Amol S Joglekar (Expert)

24 February 2020 file:///C:/Users/ADMIN/Downloads/FORM%20NO.%2013D%20[See%20rule%2028_4_]%20Application%20for%20a%20certificate%20under%20section%20194G_2_%20of%20the%20Income-tax%20Act,%201961,.pdf

Amol S Joglekar

Amol S Joglekar (Expert)

24 February 2020 and one more thing: For genuine hardship to the assessee, there is NO need to have any section. Income tax being the Act in public interest, we can always appeal to A.O. for any mischief being played due to any of the provision of the Act. Assessing Officer being in judiciary position shall pass the order in the interest of the assessee.

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