Tds on sale of property

This query is : Resolved

Saurav Nayyar (Querist)
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17 April 2019 Sir

The assessee has sold a property for Rs 2 cr and an agreement to sell was made in 4th march 2019 n Rs 1 cr as part was accepted.The next payment of Rs 1 cr was given on 15th April 2019 and the sale deed was registered in tehsil office on the same day. Questions -

1. The sale of property will be considered in which FY for calculation of capital gains by the seller ?

2. The buyer has deducted full TDS of Rs 2L on 15-04-2019 i.e in FY 2019-20.It is Ok for the seller ?

CS Advocate Abhishek Goyal

CS Advocate Abhishek Goyal (Expert)
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02 May 2019 1. In my opinion the capital gains liability will arise in FY 2019-20 when sale deed was duly executed and registered.since no property can be transferred merely on the basis of agreement to sell and in case of immovable property registration is compulsory. even from the point of view of transfer of property act no transfer of interest or ownership takes place by mere agreement to sell.
2. As per section 194IA, TDS on sale of property is required to be deducted by buyer at the time of crediting the payment so going by this TDS should have been deducted in March 2019 when part payment of Rs 1 crore was made.