Surcharge is applicable, only when payment made by the deductor exceeds the threshhold limit. Surcharge on TDS has nothing to do with the gross receipt or annual income of the deductee. The deductor is no where required to enquire into such details, nor the deductee is required to provide such details. The auditors contention is annoying. Surcharge is applicable, if payment exceeds the threshhold limit, even if the annual income of the deductee is in the negative.
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