Examine the liability for tax deduction at source in the following cases for the assessment year 2025-26: (i) On 21st July 2024, Mr. Anuj, a…

(i) Since the consideration for transfer of house property at Chennai exceeds 50lakhs, Mr. Anuj, being the transferee, is required to deduct tax @1% under section 194-IA on 85 lakhs, being the amount of consideration for transfer of property. Mr. Anuj is required to deduct tax as source @1% under section 194-IA from the amount of 54lakhs, being the higher of the stamp duty value of 54lakhs and consideration of 49,00,000 paid to Mr. Anant for transfer of urban plot, since the stamp duty value exceeds 50lakhs. Mr. Anuj is not required to deduct tax at source under section 194-IA from the consideration of 55lakhs paid to Mr. Digvijay for transfer of rural agricultural land, since the same is specifically excluded from the scope of immovable property for the purpose of tax deduction under section 194-IA. (ii) As per section 194LB, tax would be deductible @ 5% on gross interest paid/credited by a notified infrastructure debt fund, eligible for exemption under section 10 (47) , to a non-resident not being a company or to a foreign company. In the first case, since the payment is to a foreign company, health and education cess @4% has to be added to the applicable rate of TDS. Therefore, the tax deductible under section 194LB would be - 31,200 (i.e., 5.20% of 6lakhs). However, in case the notified infrastructure debt fund pays interest to a person who is a resident of a notified jurisdictional area, section 94A will apply. Accordingly, tax would be deductible @30% (plus health and education cess@4%) under section 94A, even though section 194LB provides for deduction of tax at a concessional rate of 5%. Therefore, the tax deductible in respect of payment of 2.5 lakh to Mr. Aman, who is a resident of a notified jurisdictional area, would be - 78,000, being 31.2% of 2,50,000. (iii) The landing and parking charges which are fixed by the Airports Authority of India are not merely for the "use of the land". These charges are also for services and facilities offered in connection with the aircraft operation at the airport which include providing of air traffic services, ground safety services, aeronautical communication facilities, installation and maintenance of navigational aids and meteorological services at the airport [Japan Airlines Co. Ltd. v. CIT / CIT v. Singapore Airlines Ltd. (2015) 377 ITR 372 (SC)]. Thus, tax is not deductible under section 194I which provides deduction of tax for payment in the nature of rent. Hence, tax is deductible @2% under section 194C by the airline company, Vikasa Ltd., on payment of 18lakhs made towards landing and parking charges to the Airports Authority of India for the previous year 2024-25. (iv) As per section 192, tax is deductible at source by any person who is responsible for paying any income chargeable under the head ‘Salaries'. However, as per sub-section (2A) of said section, the employee will be entitled to relief u/s 89 and consequently, he will be required to furnish to the person responsible for making the payment, such particulars in the prescribed form (i.e., Form No.10E). The person responsible for making the payment shall compute the relief and take into account the same while deducting tax at source from salary.