Tax liability as buying car of 16 lakhs with Kisan credit & savings

I am a farmer and wants to buy a car of 16lakh on cash Is there any issue from income tax department? If i pay 9 lakh from kisan credit card and 7 lakh from my savings account

Answers (1)

277 votes

As per the latest CBDT circular no. 22 of 2016 a tax collected at source (TCS) at the rate 1% will be levied on on sale consideration of a motor vehicle exceeding ten lakh rupees. As per section 206C(1 D) , tax is to be collected at source at the rate of 1 % if
sale consideration received in cash exceeds 2 lakh rupees whereas as per section 206C(1F) tax is to be collected at source at the rate of 1 % of the sale consideration of a motor vehicle exceeding 10 lakh rupees. Since the value of the the car that you are purchasing is Rs. 16 Lakh you will have to pay an additional tax of Rs. 16,000/- on the same. For any further query you can contact me.
Thank You.

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