TCS ON SCRAP UNDER 206C

Your client, the wholesaler of paper scrap, will be liable to levy 1% TCS under Section 206C.

This is because the TCS provision applies to scrap arising from the manufacture or mechanical use of goods that cannot be reused, which includes paper scrap.

 However, it's important to note that TCS will not be applicable if the buyer submits a declaration in Form 27C that the goods will be used for manufacturing, processing, or producing articles or things, or for generating power, and not for trading purposes ¹.

Additionally, since your client's annual turnover exceeds Rs. 2 crores, they will be required to collect TCS at the rate of 1% on the sale of paper scrap .

I THOUGHT THIS SECTION OF TCS LIABLE ON MANUFACTURERS ONLY FOR COLLECTING TCS @ 1%, NOT ON TRADERS.                                                                                                                     

BEACUASE AS SCRAP DEFINATION SAYS "Waste or scrap arising from the manufacture or mechanical use of goods which cannot be reused"

BUT MY CLIENT PURCHASE SCRAP ON DAILY BASIS FROM LOCAL END USERS. I.E SCRAP PAPERS, GLASS & PLASTIC BOTTLES, ALLUMINIUM SCRAP AND OTHERS