TDS on purchase of goods takes precedence over TCS, shifting tax responsibility to liable buyers meeting turnover and transaction criteria.
TDS u/s 194Q and TCS u/s 206C(1H) apply when taxpayer turnover and per-counterparty transaction thresholds are met, with TDS on buyers taking precedence over TCS on sellers. Parties must monitor aggregate transactions to determine when deduction or collection becomes due, obtain declarations regarding counterparty turnover, treat value inclusive of indirect taxes for threshold purposes, and recognize that imports to non-residents fall outside the TDS provision. Software must be classified as goods or services on facts to decide applicability; purchase returns do not alter the deduction obligation. (AI Summary)