Examine & explain the TDS implications in the following cases along with reasons thereof, assuming that the deductees are residents and having a…

(i) As per section 194-IA, if a person (transferor) transfers any immovable property whose consideration for transfer or stamp duty value is not less than 50lakh to a person (transferee), then transferee is required to deduct tax at source @1% of consideration for transfer or stamp duty value, whichever is higher. In case there are multiple transferee or transferor in respect of any immovable property, consideration shall be the aggregate of the amounts paid or payable by all the transferees to the transferor or all the transferors for transfer of such immovable property. Accordingly, in the present case, Ms. Shashi and Ms. Sujata are required to deduct tax at source @1% on 75 lakhs, being the amount higher of consideration of 60lakhs and stamp duty value of 75lakhs. (ii) As per section 194R, if any person (other than an individual or HUF whose total sales or gross receipts does not exceed 1crore or 50lakhs, as the case may be, during the immediately preceding previous year) provides any benefit or perquisite to a resident arising from his business or profession and the total value of such benefits exceeds - 20,000 in a financial year, then such person is required to deduct tax at source @10% of the total value of the benefit or perquisite. Where the benefit or perquisite is in kind, the person has to ensure before releasing such benefit or perquisite that the tax required to be deducted has been paid in respect of such benefit or perquisite. In the present case, M/s XYZ Ltd. provided a luxury car worth 15lakh to Mr. A, as an incentive which qualifies as a perquisite u/s 194R. Therefore, M/s XYZ Ltd. has to ensure before releasing the car that the tax of 1,50,000 i.e., 10% of 15lakhs has been paid by Mr. A.