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Section 206C(1H)-TCS On Sale Of Goods under of Income Tax Act, 1961

Every person, being a seller, who receives any amount as consideration for sale of any goods of the value or aggregate of such value exceeding fifty lakh rupees in any previous year, other than the goods being exported out of India or goods

Time of Deduction of TCS

at the time of receipt of such amount, collect from the buyer, a sum equal to 0.1 per cent of the sale consideration exceeding fifty lakh rupees as income-tax


  1. In case the Permanent Account Number (PAN) of the buyer is not available. Then, the seller would be liable to collect tax @5%

  2. Seller means a person whose total sales, gross receipts or turnover from the business carried on by him exceed 10 crore rupees during the financial year immediately preceding the financial year.

TDS provisions covered under section 206C(1h) are not applicable under the following cases

  • If the buyer is liable to deduct tax at source under any other provision of this Act on the goods purchased by him from the seller and has deducted such amount.

Buyer is

  • The Central Government, a State Government, an Embassy, a High Commission, legation, commission, consulate and the trade representation of a foreign state; or

  • A local Authority defined in the Explanation to section 10(20); or

  • Importer of goods or any other person notified by the Central Government.

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