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194ia

Dharmesh Parekh (Accountant) (48 Points)

26 July 2016

Our company is planning to purchase a land worth more than rupees 50 lakh.. And I think we should deduct tds @ 1, but we are paying to different co-owners of land, which comes around 10 lakh to each of them.. Is it liable to deduct TDS?

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4 Replies

AEZAZ (Student CA IPC / IPCC) (21 Points)
Replied 26 July 2016

No you dont have to dfeduct TDS as for Seller the value of land does not exeeds rs 50 lacs

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suresh (proprietor) (425 Points)
Replied 26 July 2016

Yes. You are liable to pay TDS as per provision of Income tax being the agreement value more than Rs. 50 lakh.

suresh (proprietor) (425 Points)
Replied 26 July 2016

No Mr. Aezaz, One is liable to follow the provision of TDS u/s 194IA as it clearly say

194-IA. (1) Any person, being a transferee, responsible for paying (other than the person referred to in section 194LA) to a resident transferor any sum by way of consideration for transfer of any immovable property (other than agricultural land), shall, at the time of credit of such sum to the account of the transferor or at the time of payment of such sum in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amount equal to one per cent of such sum as income-tax thereon.

(2) No deduction under sub-section (1) shall be made where the consideration for the transfer of an immovable property is less than fifty lakh rupees.

As the consideration for transfer is not less than 50 lakh, hence the provisions will be applicable.