Question:
I have a party named XYZ Co., and I have issued
multiple scrap sale invoices as follows:
|
Date |
Qty (Kgs) |
Rate (₹/Kg) |
Amount (₹) |
|
01.03.2025 |
3,400 |
37 |
1,25,800 |
|
03.03.2025 |
3,130 |
37 |
1,15,810 |
|
06.03.2025 |
2,650 |
37 |
98,050 |
|
Total |
9,180 |
37 |
₹3,39,660 |
(Amounts are excluding GST for this calculation.)
Since the rate is the same for all invoices but the invoices
are issued separately, does GST TDS apply in this case?
Answer:
✅ Yes, TDS under GST is applicable in this case. Here’s why:
-
Threshold Check:
- The total value of supply to XYZ Co. is ₹3,39,660, which exceeds the ₹2,50,000 limit under GST TDS rules.
- Even though the invoices are separate, TDS is calculated on the total value of supplies to a party, not on individual invoices.
-
Continuous Supply Consideration:
- Since multiple invoices are issued for the same nature of supply (scrap) to the same party (XYZ Co.) at the same rate, it can be treated as an "implied contract."
- The GST department considers transactions as part of a contract if there is continuity in supply and the total value exceeds the threshold.
-
TDS Deduction Rate:
- The buyer (XYZ Co.) must deduct 2% TDS (1% CGST + 1% SGST or 2% IGST) on the total invoice value.
- TDS Amount: ₹6,793 (2% of ₹3,39,660).
- XYZ Co. will deduct this TDS while making the payment and deposit it with the government.
When Would TDS Not Apply?
🚫 If each invoice was issued as a separate and independent transaction without any prior commitment or contract.
🚫 If different buyers were involved, or each transaction had no link to the previous ones.
Conclusion:
Since multiple invoices were issued for the same supply (scrap) to XYZ Co. and the total value exceeded ₹2,50,000, the TDS liability applies under GST rules.
Disclaimer:
The information provided in this article is for general informational purposes only and is based on the GST laws applicable in India as of the date mentioned. Tax laws and interpretations may vary, and their applicability depends on specific circumstances.
Readers are advised to consult their Chartered Accountant (CA), financial advisor, or tax consultant before making any decisions related to GST TDS compliance to ensure accuracy and compliance with the latest regulations. The author or publisher is not responsible for any financial or legal consequences arising from the use of this information.