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NRI not agreeing to TDS deduction for Sale of House

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Anonymous

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21 Points Posted on 02 January 2021

I am in discussions with a NRI for purchase of his house. I have also paid him an advance through cheque. Now he is not agreeing for the TDS deduction. Canceling the transaction will be loss for me because the MOU states that whoever cancels has to compensate the other with an agreed amount and also pay the brokerage. The NRI is also not willing to get the lower tax deduction certificate.

Is there some legal action I can take?

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Quick Summary

A buyer is facing issues with an NRI seller who is refusing to allow TDS deduction on the sale of a house, despite an advance payment and a signed MOU. The seller is also unwilling to obtain a lower tax deduction certificate. The buyer is seeking advice on legal recourse, as cancelling the deal would incur significant financial penalties. The advice given is to explain to the NRI that income from the sale of Indian property is taxable and TDS deduction under Section 195 is mandatory to avoid penalties.