TDS

I had purchased a plot in 2010 with a total cost of Rs. 55 lacs by paying advance of Rs. 25 lacs. However, the developer could not acquire the land due to farmer agitation. Now the developer has acquired the land and the plot is being offered to me at the booking price of Rs. 55 lacs. I am required to pay the balance Rs. 30 lacs. My two queries are:
1. TDS is now applicable at 1%. Should I deduct tds on 30 lacs or 55 lacs. What has to be shown as consideration 30 or 55 lacs.
2. If I sell my right in the booking, I get 35 lacs premium ie the buyer pays my Rs. 25 lacs which the developer took plus 35 and also pays the balance 30 directly to the developer. What are tds implications in such a case?

PK Gogia

Asked 5 years ago in Income Tax

Is it a rural agricultural land that he is offering you?

If yes no TDS is required to be deducted.

Else technically speaking as per section 194IA TDS needs to be deducted at the time of credit or payment whichever is earlier and hence payment was made in 2010 when no such section exist hence no need to deduct TDS on such 25 lakh just deduct on balance 30 lakh and show consideration as full 55 lakh as same would be reflected in the sale deed.

No TDS would be deducted on you selling your right as TDS needs to be deducted only on consideration for immovable property.

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