TDS on purchase of property through EOI

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This query is : Resolved

atul (Querist)
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12 August 2026 I have booed a property with the builder and paid 15 Lakhs at the time of pre launch in the form of EOI and thereafter allotment was made by the builder after3 months. At the time of allotment t 40 Lakhs was paid with deduction of TDS ON 55 lakhs.
Now , received a notice for delayed payment of TDS from the department.
Kindly clarify whether there is any delay in payment of TDS and whether TDS is applicable at the time of pre launch.

Aashok Kumar Sharma

Aashok Kumar Sharma

(Expert)
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13 August 2026 Yes, TDS under Section 194IA is applicable at the time of paying the advance/EOI amount (₹15 Lakhs) because the overall property transaction value (₹55 Lakhs) exceeds the threshold limit of ₹50 Lakhs. Section 194IA requires deduction at the time of payment or credit, whichever is earlier.

Notice for Delayed Payment:
The notice from the Income Tax Department for delayed payment is valid. Because the TDS on the ₹15 Lakhs advance was not deducted/deposited at the time of the EOI payment (and instead paid after 3 months at allotment), interest under Section 201(1A) is applicable for the 3-month delay on the ₹15,000 TDS portion.

Next Steps:

Check the demand details on the TRACES portal under the "Outstanding Demand" section.

Pay the applicable interest amount under Section 201(1A) using the Form 26QB demand payment option to resolve the notice.

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