APPLICATION UNDER SECTION 395(1) OF THE INCOME-TAX ACT, 2025 FOR A CERTIFICATE OF LOWER OR NIL DEDUCTION OF TAX ON THE TRANSFER OF IMMOVABLE PROPERTY BY A NON-RESIDENT, TOGETHER WITH A TAX DEDUCTION UNDERTAKING AND INDEMNITY BETWEEN THE SELLER AND THE BUYER
Executed at Brampton, Ontario, Canada on 4 April 2026.
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PART A — STATEMENT OF FACTS, COMPUTATION AND VERIFICATION IN SUPPORT OF FORM No. 128
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To
The Assessing Officer (International Taxation),
International Taxation Ward 1(1), Chandigarh.
Subject: Application in Form No. 128 under section 395(1) of the Income-tax Act, 2025 read with Rule 213 of the Income-tax Rules, 2026, for a certificate authorising deduction of tax at a lower rate, or no deduction of tax, on the consideration payable for the transfer of the immovable property described in Schedule I below. Permanent Account Number AFZPG1234K. Financial year 2026-27.
Madam or Sir,
- THE APPLICANT
1.1 I, Harjinder Singh Gill, son of Sardar Mohan Singh Gill, holding Permanent Account Number AFZPG1234K and passport Z4821956, issued by Canada; OCI card A1234567, am a Non-Resident Indian holding an Indian passport, and I am a non-resident within the meaning of the Income-tax Act, 2025 for the financial year 2026-27. I am referred to in this document as the Seller.
1.2 My address outside India is 48 Silverdart Crescent, Brampton, Ontario L6X 0Y2, Canada. My address in India for the service of notices, requisitions and orders is House No. 214, Model Town, Jalandhar 144003, Punjab. I may be reached by electronic mail at hsgill48@example.com and by telephone on +1 647 555 0182, and I consent to service of every notice and order in this proceeding at that electronic mail address.
1.3 This application is being pursued in India on my behalf by Manpreet Singh Gill, who is my spouse, under a power of attorney executed by me on 2 April 2026 and authenticated in the manner required by section 33(1)(c) of the Registration Act, 1908. A copy of that power of attorney is enclosed at Schedule III. The verification at the foot of this Part is nevertheless made and signed by me personally.
- THE BUYER, WHO IS THE PERSON RESPONSIBLE FOR DEDUCTION
2.1 Rajesh Kumar Bansal, son of Shri Om Parkash Bansal, holding Permanent Account Number BXQPB7788L and residing at Flat 502, Tower C, Sector 70, SAS Nagar (Mohali) 160071, Punjab, is the intending purchaser of the property described in Schedule I and will be the person responsible for deducting tax at source on the consideration. That person is referred to in this document as the Buyer.
2.2 The Buyer's Tax Deduction and Collection Account Number has been allotted. That number is PTLR09876G, and the certificate applied for is sought to be issued in respect of deduction by that deductor. A certificate under section 395(1) operates in favour of a named deductor, and the Buyer has undertaken in Part B of this document to communicate the number to me and to this office within seven days of its allotment if it has not already been communicated, and to make no payment of consideration before that number exists.
- THE PROPERTY, THE SELLER'S SHARE IN IT, AND THE PROPOSED TRANSFER
3.1 I am in possession of the residential house more particularly described in Schedule I, situated in Village Kang Sahbu, Tehsil Phillaur, District Jalandhar, Punjab, bearing Khewat No. 148, Khatauni No. 231, Khasra Nos. 1102/1 and 1102/2 and admeasuring 4 kanal 6 marla (approximately 2,175 square metres). My interest in it is that of sole and absolute owner, and the share held and to be transferred by me is one-half of that property.
3.2 Where I hold less than the whole, this application, the computation in Schedule II and the certificate sought relate to my share alone. Every other co-owner is a separate assessee, must make a separate application in Form No. 128 under his or her own Permanent Account Number, and the consideration and the gain are apportioned between us according to our respective shares. The names and shares of the other co-owners are stated in Schedule I.
3.3 I acquired my share in the said property by purchase under a registered sale deed on 1 April 2026, at a cost of acquisition of ₹9,25,000 (Rupees Nine Lakh Twenty Five Thousand only). Documentary evidence of the acquisition is enclosed at Schedule III.
3.4 By an agreement to sell dated 3 April 2026, the said property was agreed to be sold to the Buyer for a total consideration of ₹1,60,00,000 (Rupees One Crore Sixty Lakh only) for the whole of it, of which ₹80,00,000 (Rupees Eighty Lakh only) is attributable to my share. The value of the whole of the said property computed at the Collector rate notified for the revenue estate in which it lies is ₹1,42,00,000 (Rupees One Crore Forty Two Lakh only), of which ₹71,00,000 (Rupees Seventy One Lakh only) is attributable to my share. The sale deed is expected to be executed and presented for registration on or about 5 April 2026.
3.5 The consideration attributable to my share is to be paid through banking channels and credited to my Non-Resident Ordinary account NRO Savings A/c No. 30124578963 maintained with State Bank of India, Model Town Branch, Jalandhar. No part of it is to be paid in cash, by traveller's cheque or in foreign currency notes, in conformity with the Foreign Exchange Management (Non-debt Instruments) Rules, 2019 and paragraph 3.3 of Reserve Bank of India FED Master Direction No. 12/2015-16 on the acquisition and transfer of immovable property.
- WHY A CERTIFICATE IS SOUGHT
4.1 On a purchase from a non-resident seller, the obligation of the person responsible for payment is to withhold tax on the whole sum paid, and not merely on the income embedded in that sum, unless a certificate under section 395(1) directs otherwise. The concessional deduction of one per cent that applies where the seller is resident in India has no application to this transaction, and neither the Buyer nor I intend to proceed on that footing.
4.2 On this transaction the difference is decisive. The consideration payable to me is ₹80,00,000 (Rupees Eighty Lakh only), whereas the income chargeable to tax in my hands is the estimated long-term capital gain of ₹20,90,000 (Rupees Twenty Lakh Ninety Thousand only), computed in Schedule II. Tax withheld on the gross consideration would exceed by a very wide margin the tax that will finally be found payable, and the excess would be recoverable only by way of refund after my return of income for the financial year 2026-27 has been filed and processed. That is money locked up for the better part of two years, in a currency in which I do not live, and it serves no revenue purpose.
4.3 I therefore apply for a certificate authorising deduction of tax at 12.5 per cent plus applicable surcharge and health and education cess, on the estimated capital gain only, computed upon the estimated long-term capital gain set out in Schedule II and not upon the gross consideration.
4.4 I further claim the following exemption or relief, and the certificate is sought after giving effect to it, the supporting evidence being enclosed at Schedule III: The Seller has agreed to purchase a residential flat in SAS Nagar (Mohali) for ₹52,00,000 under an allotment letter dated 3 September 2026 and will invest the entire capital gain in it within the statutory period, and accordingly claims exemption on reinvestment in a residential house. A copy of the allotment letter and the builder's payment schedule are enclosed.
- UNDERTAKINGS AND DISCLOSURES GIVEN WITH THIS APPLICATION
5.1 I undertake to file a return of income for the financial year 2026-27 disclosing this transfer and the resulting capital gain, whether or not any further tax is finally found payable.
5.2 I undertake to inform this office in writing, before the sale deed is executed, of any change in the consideration, in the expected date of completion, or in the identity of the Buyer, and to make a fresh application where the certificate issued no longer fits the transaction.
5.3 I state that, to the best of my knowledge and belief, the said property is not the subject of any attachment, prohibitory order, provisional attachment or outstanding demand under the Income-tax Act, 2025 or under the Income-tax Act, 1961.
5.4 To the best of my knowledge and belief, for the financial year 2026-27 and apart from the capital gain disclosed in this statement, I have no income chargeable to tax in India.
5.5 I undertake to produce the originals of every document listed in Schedule III for inspection, and to attend before this office in person or through my authorised representative as and when required.
SCHEDULE I — THE PROPERTY
All that residential house bearing Khewat No. 148, Khatauni No. 231, Khasra Nos. 1102/1 and 1102/2, admeasuring 4 kanal 6 marla (approximately 2,175 square metres), situated in Village Kang Sahbu, Tehsil Phillaur, District Jalandhar, Punjab, and more particularly described as follows:
A double-storeyed residential house constructed on a plot measuring 4 kanal 6 marla, comprising ground and first floors with a boundary wall, bounded on the North by the village link road, on the South by the property of Sh. Gurmeet Singh, on the East by a common passage 10 feet wide, and on the West by the property of Smt. Balwinder Kaur. Acquired under sale deed No. 3421 dated 12 August 2004 registered in the office of the Sub-Registrar, Phillaur. The other co-owner is Sh. Manjit Singh Gill, holding the remaining one-half share, who is making his own separate application.
The share of the Seller in the property so described is one-half.
SCHEDULE II — COMPUTATION OF THE ESTIMATED CAPITAL GAIN ON THE SELLER'S SHARE
(a) Full value of the consideration agreed for the whole of the property: ₹1,60,00,000 (Rupees One Crore Sixty Lakh only)
(b) Value of the whole of the property computed at the Collector rate for the revenue estate: ₹1,42,00,000 (Rupees One Crore Forty Two Lakh only)
(c) Share held and transferred by the Seller: one-half
(d) Consideration attributable to the Seller's share: ₹80,00,000 (Rupees Eighty Lakh only)
(e) Collector rate value attributable to the Seller's share: ₹71,00,000 (Rupees Seventy One Lakh only)
(f) Value adopted for the Seller's share, being the higher of (d) and (e) above: ₹80,00,000 (Rupees Eighty Lakh only)
(g) Date of acquisition of the Seller's share: 1 April 2026
(h) Mode of acquisition: purchase under a registered sale deed
(i) Cost of acquisition of the Seller's share: ₹9,25,000 (Rupees Nine Lakh Twenty Five Thousand only)
Add: cost of improvement referable to the Seller's share, supported by bills enclosed at Schedule III — ₹3,10,000 (Rupees Three Lakh Ten Thousand only)
Add: expenditure incurred wholly and exclusively in connection with the transfer, referable to the Seller's share — ₹80,000 (Rupees Eighty Thousand only)
(j) Nature of the gain arising: long-term capital gain
(k) Estimated gain chargeable to tax in the Seller's hands: ₹20,90,000 (Rupees Twenty Lakh Ninety Thousand only)
(l) Rate of deduction applied for: 12.5 per cent plus applicable surcharge and health and education cess, on the estimated capital gain only