• TDS deduction on unregistered property

Hello sir I am purchasing an apartment from an owner which is ready to move in , but the owner has not yet registered the apartment from builder ,so he will transfer his rights to me through assignment agreement. In the assignment agreement sale value mentioned will be Rs 75,70,000, and the owner has paid to the builder of Rs 70,27,267 including all the charges and additional transfer charges Rs 152000, and delayed payment interest component Rs 2,00,000 he is paying it. Total amount will be Rs 7380195 to the builder. 

Till now total TDS deduction of Rs 60431 has been paid by owner to the builder pan no .
So after assignment agreement builder will be registering the property directly in my name and the sale deed value will be Rs 55,00,000 according current government guide line value on that amount builder will register the apartment.

My question is how much TDS deduction should I do and transfer the amount to the owner .
And will the TDS be applicable to additional charges like bescom , bwssb , sinking fund , service tax vat, gst should I count it in or minus it on Rs 7380195 which the owner has paid .
Asked 4 years ago in Property Law
Religion: Hindu

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3 Answers

1. Whatever amount towards sale consideration which you will pay to the owner for assigning his rights to you, on that amount you will have to deduct TDS

2. When owner bought from builder, owner deducted TDS from amounts paid to builder. That is one independent transaction

3. When owner assigns his right to you, you will pay certain consideration to owner seller. That is a separate transaction

4. So the two transactions are independent of each other

5. You have to deduct tds from all amounts which you will be paying to owner except the taxes like stamp duty, registration fee, gst etc. There cannot be tax on a tax. That would amount to double taxation which is prohibited

Yusuf Rampurawala
Advocate, Mumbai
6882 Answers
79 Consultations

5.0 on 5.0

Dear Client,

Above calculation if reduced in to writing in documents will clearly show evasion of stamp duty by showing less sale consideration.

Without POA or sale deed executed by builder in favor of owner, he cannot assign any right/transfer ownership in you.

Rate of TDS is predefined, 1% of sale above 50 lacs which will shown in sale deed.

And first purchase if shown in sale deed, transfer in owner than in you, registrar will charge stamp duty on first transfer too,

Yogendra Singh Rajawat
Advocate, Jaipur
21481 Answers
31 Consultations

4.4 on 5.0

If you are registering your property for some value, the TDS shall be applicable to that value alone.

You may be paying an higher amount but that is off the record, you must ascertain that how you are going to account the extra amount.

T Kalaiselvan
Advocate, Vellore
78095 Answers
1543 Consultations

5.0 on 5.0

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