Tds for purchase of property

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SAURABH KASTURIWALE

PRACTISING C.A.

111 Points Posted on 30 April 2016

My client has received a notice from the IT Deptt. To show cause why TDS was not deducted and paid at the time of property purchase:

Facts of the case :

1) Market Value as per Registrar 51,50,000 RS. But Actual Sale Consideration is only 42,00,00 RS.

2) The Sale Consideration was given as follows:

On 31.03.2013 (I.e.prior to enactment of section) RS 40,00,000 and on 15.06.2013 ( I.e. after enactment of the section) RS 2,00,000.

Kindly guide whether there is any liability to deduct and pay TDS in this case.

Thanks in advance.

Replies (4)

MEGHA CHAUHAN

CHARTERED ACCOUNTANT

42 Points Posted on 30 April 2016

SAURABH,

their is no liability to deduct TDs as actual sale considertion is considered while evaluation applicability of section 194IA, Market value is of no relevance.

SAURABH KASTURIWALE

PRACTISING C.A.

111 Points Posted on 30 April 2016

Is there any case law or CBDT clarification / circular in this regard so that I can make my submission to the Deptt stronger.

Please provide in case anybody has one.

Vishal Goel

Chartered Accountant

1725 Points Posted on 02 May 2016

You are not required to deduct TDS under section 194-IA since the total consideration does not exceeds 50 Lakhs. The stamp duty value is not a consideration for TDS!

Don’t worry, several taxpayers recently received notices from the department for not deducting TDS u/s 194ia.

Vishal Goel

Chartered Accountant

1725 Points Posted on 02 May 2016

You are not required to deduct TDS under section 194-IA since the total consideration does not exceeds 50 Lakhs. The stamp duty value is not a consideration for TDS!

Don’t worry, several taxpayers recently received notices from the department for not deducting TDS u/s 194ia.