What does section 51 regulate?

It regulates tax deduction at source. Read the exact text, conditions, exceptions and transaction date together.

Which subordinate law should be checked?

No direct CGST Rule has been certified in this phase. Notifications, circulars, forms and the corresponding SGST/UTGST layer may also apply.

What evidence should be retained?

Preserve the contract or transaction record, invoice or form, portal acknowledgement, payment/ledger evidence, correspondence, legal working and the official source version used.

Can portal behaviour override the statute?

No. Portal functionality is operational evidence; legal entitlement and liability remain controlled by the Act, Rules, notifications and binding decisions.

Section 51 - Tax deduction at source

Chapter X - Payment of Tax

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Source control: The text/status on this page is tied to the official source gateway and the Phase 1 legal-review register. Open official source.

Finin2min Summary - Section in 2 Minutes

Requires notified Government/public bodies and other notified persons to deduct GST TDS from qualifying contracts. Threshold is contract value exceeding 2.5 lakh excluding GST. No deduction where supplier location and place of supply are in a State/UT different from recipient registration State/UT. Deducted amount is paid and reported in GSTR-7; deductee receives cash-ledger credit. Delayed deduction/payment can attract interest and other consequences.

Exact operative text

51. Tax deduction at source.-(1) Notwithstanding anything to the contrary contained in this Act, the Government may mandate,- (a) a department or establishment of the Central Government or State Government; or (b) local authority; or (c) Governmental agencies; or (d) such persons or category of persons as may be notified by the Government on the recommendations of the Council, (hereafter in this section referred to as “the deductor”), to deduct tax at the rate of one per cent. from the payment made or credited to the supplier (hereafter in this section referred to as “the deductee”) of taxable goods or services or both, where the total value of such supply, under a contract, exceeds two lakh and fifty thousand rupees: Provided that no deduction shall be made if the location of the supplier and the place of supply is in a State or Union territory which is different from the State or as the case may be, Union territory of registration of the recipient. Explanation.-For the purpose of deduction of tax specified above, the value of supply shall be taken as the amount excluding the central tax, State tax, Union territory tax, integrated tax and cess indicated in the invoice. (2) The amount deducted as tax under this section shall be paid to the Government by the deductor within ten days after the end of the month in which such deduction is made, in such manner as may be prescribed. (3) A certificate of tax deduction at source shall be issued in such form and in such manner as may be prescribed. (5) The deductee shall claim credit, in his electronic cash ledger, of the tax deducted and reflected in the return of the deductor furnished under sub-section (3) of section 39, in such manner as may be prescribed. (6) If any deductor fails to pay to the Government the amount deducted as tax under sub-section (1), he shall pay interest in accordance with the provisions of sub-section (1) of section 50, in addition to the amount of tax deducted. (7) The determination of the amount in default under this section shall be made in the manner specified in section 73 or section 74 or section 74A. (8) The refund to the deductor or the deductee arising on account of excess or erroneous deduction shall be dealt with in accordance with the provisions of section 54: Provided that no refund to the deductor shall be granted, if the amount deducted has been credited to the electronic cash ledger of the deductee.

Paragraph-wise decode

Section-Rule-Form-Notification bridge

No direct Rule certified in Phase 1. Check notifications, circulars, forms and corresponding State law.

The mapping is a legal concordance, not a round-robin related-link list. It is limited to instruments certified in this phase.

Practical example

A notified recipient pays 4 lakh plus GST under one contract. TDS applies on taxable value if place-of-supply conditions are satisfied.

Professional alert

Do not split purchase orders to avoid the contract threshold; test the total contractual arrangement.

Implementation checklist

Fix the transaction, taxable period and jurisdiction.
Read every subsection, proviso, explanation and omission marker.
Open the mapped Rule, form, notification and circular.
Test State/UT variation and portal version.
Preserve evidence, approvals, working papers and acknowledgements.
Record the conclusion, assumptions, source date and reviewer.

Evidence and retention checklist

Contract, purchase order, invoice or underlying transaction document.
Registration, return, ledger, challan and portal acknowledgement.
Official Act/Rule/notification version used and effective date.
Internal tax position paper, computation and management approval.
Correspondence, notices, replies, orders and appeal papers where applicable.

Practical Q&A

What does section 51 regulate?: It regulates tax deduction at source. Read the exact text, conditions, exceptions and transaction date together.
Which subordinate law should be checked?: No direct CGST Rule has been certified in this phase. Notifications, circulars, forms and the corresponding SGST/UTGST layer may also apply.
What evidence should be retained?: Preserve the contract or transaction record, invoice or form, portal acknowledgement, payment/ledger evidence, correspondence, legal working and the official source version used.
Can portal behaviour override the statute?: No. Portal functionality is operational evidence; legal entitlement and liability remain controlled by the Act, Rules, notifications and binding decisions.

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