TDS of 1% on sale / purchase of property

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  1. Sridhar Babu

    Sridhar Babu New Member

    I have purchased a property in Bangalore for Rs. 54.5 lakhs, the lending bank has financed 80% of the property value and the rest was funded personally. My query here is eventhough the value of the property is Rs. 54.5 lakhs the property was registered at Rs. 40 Lakhs based on the guidance value of the location, however the bank had disbursed based on the agreement value ( Construction agreement and Sale agreement) which was Rs. 54.5, when the loan was disbursed they had paid the builder deducting the 1% TDS and had paid me the 1% TDS amount after taking a declaration that I will remit it to the tax authorities.

    When I inquired with builder they are insisting that since the registration value was Rs. 40 lakhs no need for the TDS to be remitted and the amount should be paid to them or if I insist pay the TDS for the registered value saying that if any excess amount is remitted they will have problems, Please suggest, should I pay the builder or remit it to the tax authorities.


  2. Dear Sridhar,

    if you remit to the tax authorities, the builder MAY be in trouble

    if you paid to the builder, you will be n trouble.

    Registrar will not give details about you to income tax department in his Annual Information Return but that finance company will furnish about your transaction.

    so you will be n the eyes of income tax department.

    for the builder, he MAY not worry as he received 54.5L as his consideration. Service Tax, Income tax will consider that amount only.

    remit to tax authorities

    for more refer
    Karan Batra likes this.
  3. Sridhar Babu

    Sridhar Babu New Member

    Mr. Satya, Thanks for the reply, please suggest since I am insisting on payment of the TDS the builder is asking me to get the registration done on the actual value, which will make me to incur additional cost. Also is it possible to get it registered again with new value since the agreements and sale deed have already submitted to the finance company.
  4. I think he can't register again for higher value.
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