Personal Finance

Your Taxes

Sudhakar Sethuraman | Updated on February 16, 2020

My aunt sold her landed property in Bengaluru for a consideration of ₹80 lakh. The purchasers (individuals) deducted ₹80,000 towards TDS and the balance amount was credited to her bank account. The transactions have been properly recited in the registered sale deed executed between the parties with the respective PAN numbers. The registration of the document was done on May 22, 2019. A tax-saving bond u/s 54EC was subscribed to for the LTCG portion in November 2019.

The purchasers have not yet credited the TDS amount in her PAN account despite the rule that it should be credited within a month. No TDS certificate has also been given. Kindly advise how to proceed in the matter for settling the issue by the end of the current financial year.

Asok Kumar

Section 194IA of the Income Tax Act imposes an obligation on the purchaser to withhold and deposit the taxes to the government treasury within a period of 30 days from the end of the month in which the deduction is made and file a challan-cum-statement in Form 26QB, where the consideration on the transfer of the immovable property is ₹50 lakh or more.

Section 203 of the I-T Act requires the purchaser to issue the TDS certificate in Form 16B. Failure to comply with this attracts interest, penal implications and initiation of prosecution proceedings for the purchaser.

Section 205 protects the taxpayer from payment of any tax to the extent such taxes were already deducted.

In view of the above, even if the purchaser has not deposited the tax deducted, you can claim such TDS credit in your India tax return, relying on Office Memorandums issued by the Central Board of Direct Taxes (CBDT) on June 1, 2015, and March 11, 2016, advising tax officers not to recover the tax amount from the taxpayers if the deductor has already withheld the taxes and failed to deposit the same.

Also, as per a Bombay High Court decision in case of Yashpal Sahni (2007 TMI 1646), it was held that the tax authorities cannot recover the taxes once again from the taxpayer who has suffered the deduction. In case of any enquiry from the tax office, you may have to explain the situation in detail and furnish the sale agreement and other documents evidencing the tax-withholding by the purchaser.

Further, a grievance petition can be filed via the e-filing portal under the tab resolution sought from ‘Centralised Processing Centre for TDS return (CPC- TDS)’.

The writer is Partner, Deloitte India. Send your queries to

Published on February 16, 2020

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