OCI Income Tax liability

The tax liability will be same in both the cases, except TDS deduction by Buyer. In first case there will be additional liability of stamp duty & registration charges.

TDS liability lies over buyer, seller can offload the liability in buyer's name.

What is the long term capital gains tax % in both of these cases?

TDS deduction by buyer is only applicable for case 2. Right? Is the TDS on profit amount or sale amount? Should we get the TDS certificate from the buyer at the time of registration and then claim the return when filing the IT returns with the help of a CA?

In both the cases it will be 20% + cess.

TDS in first case will be 1%, only if the value of the property be Rs. 50L or more.

TDS rate on NRI/OCI seller will be 20%+ surcharge, whatever be the property value.

Seller can apply for lower deduction of TDS with his jurisdictional ITO.

Yes, buyer will issue tax deduction certificate in form 16B.

Oh. Tax is (20% + cess) on the profit. But TDS is (20% + surcharge) on sale value. This sounds little strange.

What happens if the buyer doesn't take the responsibility of TDS and issue form 16B to the seller (OCI)? Should the seller file his income tax and pay (20% + cess) on the profit directly to the IT department? 

1. The difference if any, gets adjusted during assessment of the return. Excess if any, gets refunded.

2. Buyer has to deduct TDS, otherwise he can be penalized. (unless seller procures 'No Tax Deduction Certificate' from his Jurisdictional ITO.)