Question And Answer
Subject: TDS under section 194H &194Q
Querist: Sachin Dinkar More
Answered by:
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Date: July 26, 2023
Query asked by Sachin Dinkar More

My client is a Kaccha Artia in Anaj Mandi (Grain Market) which sells goods on Dami (Commission) on auction in Anaj Mandi to soyabean solved plant. The Transaction is as follows: –

Sale price = 100000/- + Commission = 2000/- + Market Board Fee = 100 total = 102100/- . The buyer is deducting TDS u/s 194H on Rs.102100/- and if the purchase value goes above 5000000 lakh through out year after that they deducting TDS u/s 194Q on total purchase value.Now Section 194Q has been inserted since July 2021. Therefore the buyer has starting deducting TDS under both the section. i.e. u/s 194H and u/s 194Q.

Kindly clarify that they are following right method.

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The Buyer cannot deduct tax under section 194H of the Act on the whole amount of Rs. 1,02,100/-. Deduction under section 194H of the Act should be restricted to commission and deduction under section 194Q of the Act should be on the Sale price.

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