The threshold limit of Rs. 50 lakhs for TDS deduction under Section 194-IA of the Income Tax Act applies to the individual share of each co-transferee, not the total property value, as each transferee is a separate tax entity.

ORDER

PER C.N. PRASAD, J.M.

This appeal is filed by the assessee against the order of Ld. CIT(A)/NFAC dated 26.05.2025 for the A.Y. 2025-26, arising out of the order passed u/s.200A of the Act by the AO for non deduction of TDS on the payment made for purchase of property by the assessee.

2. None appeared on behalf of the assessee nor any adjournment application was moved, thus the appeal of the assessee is disposed of after hearing the Ld. DR.

3. In this case intimation u/s.200A of the Act was passed by the ACIT, CPC, TDS, treating the assessee in default for non deduction of TDS on the payment made for property purchase of property by the assessee. The short deduction of TDS was arrived at Rs.3,48,333/- and including interest the net payable was determined at Rs.3,51,820/-. Before the NFAC the assessee submitted that the provisions of section 194-IA of the Act are not applicable and the assessee is not required to deduct TDS @ 1% on the purchase of the property when value of such property is less of Assessee’s share than Rs.50 lakhs. The Assessee contended that the provisions of section 194-IA of the Act are not applicable to the assessee for the reason that the purchase consideration of Rs.55 lacs was jointly paid by the assessee alongwith two other persons and therefore, the assessee’s share in the property was only Rs.18,13,333/- and this amount is less than Rs.50 lacs, thus the assessee was not required to deduct TDS. The assessee placed reliance on various decisions of the Delhi Tribunal to support his contentions.

4. However, the Ld. CIT(A) / NFAC was of the view that the threshold limit of Rs.50 lacs is not to be considered on the basis of respective share of co transferee and rather has to be taken as total value of the property. Against this order of the Ld. CIT(A) the assessee is in appeal before us.

5. We find merit in the contentions of the assessee. We observed that identical issue came up for consideration before the Delhi Bench of the Tribunal in the case of Vinod Soni Vs. ITO in ITA No.2736/Del/2015 & 2739/Del/2015 and the Tribunal by order dated 10.12.2018 held as under :-

“5. We have heard both the parties and perused the records especially the impugned order as well as the provisions of law on the subject and the case laws cited by the Ld. DR in his written submissions. We find that in the instant case Sh. Pradeep Soni; Smt. Babli Soni; Sh. Vinod Soni and Smt. Beena Soni of same family, purchased 1/4th undivided equal shares in immovable property, Plot No. 94, Block-F, SLF Model Town, Sector-10, Faridabad vide single registered sale deed dated 3.7.2013 for Rs. 1,50,00,000/-. The 1/4th share purchase consideration for each person was only Rs. 37,50,000/- each. The AO held that since the value of the property purchases under single sale deed was exceeding Rs. 50,00,000/-therefore, as per section 194 IA(2), the assessee was required to deduct TDS @1%. The AO thus held that all the four assessees as defaulter u/s. 201(1) and created a total liability @ 1% i.e. Rs. 1,50,000/- by a common order u/s. 201(1) of the Act and Ld. CIT(A) confirmed the findings of the AO. During the hearing, Ld. Counsel for the assessee draw our attention towards the Paper Book-I Page no. 1 to 8 which is a copy of purchase deed dated 3.7.2013 was attached especially page no. 6 para no. 4 of the Sale Deed which is reproduced as under:-

"4. That the actual physical possession of the said Residential Plot No. 94, Block-F, Area Measuring 500 sq. yards in the residential known as DLF's Model Town, Sector-10, Faridabad situated in Village