New Delhi: The Supreme Court on Wednesday dismissed a petition that sought directions for creating an institutional mechanism to make property buyers aware of their obligation to deduct tax at source (TDS) while purchasing property valued above ₹50 lakh.
A bench comprising Justices Vikram Nath and Sandeep Mehta declined to entertain the plea and simply ordered, “Dismissed.”
The petitioner, who argued the matter in person, submitted that the issue pertained to the implementation of provisions under the Income Tax Act governing property transactions exceeding ₹50 lakh. He contended that the current framework places the entire responsibility of deducting TDS on the buyer, assuming that every purchaser has adequate knowledge of income tax laws.
According to the petitioner, this assumption is unreasonable, especially in the absence of any administrative system to ensure awareness or verification of TDS compliance at the stage of property registration. He argued that many genuine buyers, particularly first-time purchasers, may unknowingly fail to comply and later face penalties and interest despite having no intention to evade tax.
Citing his own experience as a first-time homebuyer, the petitioner claimed he was unaware of the TDS requirement at the time of registration. He maintained that the issue was systemic, as several buyers complete property registration without verification of TDS compliance at the registrar’s office.
Clarifying his position, the petitioner told the court that he was not challenging the validity of the relevant provisions of the Income Tax Act or disputing the tax liability itself. Instead, he sought limited directions for introducing institutional safeguards to prevent citizens from inadvertently falling into default due to what he described as a systemic gap.
He argued that introducing awareness and verification mechanisms would not only protect honest buyers but also enhance voluntary compliance and safeguard government revenue.
However, the apex court declined to intervene in the matter and dismissed the petition.
