1. Legal Definitions
A. “Seller” (Section 206C(1))
- Who is a Seller?
- Any person/entity(individual, HUF, company, firm, LLP, AOP, etc.) selling specified goods (liquor, scrap, minerals, etc.)
- Must have total sales/turnover exceeding ₹10 crorein the previous financial year (FY 2023-24 for FY 2024-25 TCS)
- Includes:
- Manufacturers(if selling scrap/minerals)
- Government agencies(if selling forest produce)
- Auctioneers(for timber, liquor licenses)
B. “Buyer” (Section 206C(1))
- Who is a Buyer?
- Any person/entity purchasing specified goodsfrom the seller
- Exemptions:
- Government bodies(central/state)
- Public sector undertakings (PSUs)
- Buyers submitting Form 27C(for manufacturing/processing, not resale)
2. Special Cases (Section 206C(1F) – E-commerce & High-Value Sales)
A. “Seller” under (1F)
- E-commerce operators(Amazon, Flipkart, etc.)
- Entities selling goods above ₹50 lakh per buyer(even if turnover < ₹10 crore)
B. “Buyer” under (1F)
- Any purchaser(individual, company, etc.) buying:
- Motor vehicles > ₹10 lakh
- Other goods > ₹50 lakh in a year
3. Judicial Interpretations
| CASE LAW | KEY RULING |
| CIT vs. Karnataka Forest Dept. (2019) | Govt. selling timber = “seller” liable for TCS |
| Jindal Steel vs. ITO (2021) | Scrap sold by manufacturer = TCS applicable |
| Amazon India vs. CBDT (2023) | E-commerce operator = “seller” for (1F) |
4. Compliance Checklist for Sellers
✅ Verify buyer’s PAN (else 1% higher TCS)
✅ Collect TCS at time of sale/payment (whichever earlier)
✅ File quarterly TCS return (Form 27EQ)
✅ Issue TCS certificate (Form 27D) within 15 days
Penalty for Non-Compliance:
- Failure to collect: 100% of TCS amount + interest
- Late filing: ₹200/day (max. TCS amount)
5. Buyer’s Relief Options
- Submit Form 27C(if goods used for manufacturing)
- Claim TCS credit in ITR(via Form 26AS)
- Apply for refundif TCS collected wrongly
Example:
- A steel mill (buyer)purchases scrap worth ₹60L from a dealer (seller).
- Seller’s duty: Deduct 1% TCS (₹60,000) unless buyer submits Form 27C.
Key Takeaways
✔ Seller = Any entity selling specified goods (turnover > ₹10 cr)
✔ Buyer = Any purchaser (except govt./PSUs/manufacturers with Form 27C)
✔ E-commerce operators = Sellers under (1F) for high-value sales
✔ Strict PAN & return filing rules apply
