1. Mr. Rajesh and Mr. Brijesh, resident individuals, are due to receive ₹ 13 lakhs each on 1.4.2022 on maturity of life insurance policy taken on 31.3.2012 and 1.4.2012, respectively, the sum assured of which is ₹ 10 lakhs. They had paid an annual premium of ₹ 1.10 lakhs each. Are provisions of tax deduction at source attracted on maturity proceeds received by Mr. Rajesh and Mr. Brijesh?
(a) Yes; Tax is deductible at source on maturity proceeds receivable by both Mr. Rajesh and Mr. Brijesh, since the annual premium is more than ₹ 1,00,000, being 10% of ₹ 10 lakhs
(b) No; Tax is not deductible at source on maturity proceeds receivable by either Mr. Rajesh or Mr. Brijesh, since the annual premium is less than ₹ 1,30,000, being 10% of ₹ 13 lakhs
(c) No tax is deductible at source on maturity proceeds receivable by Mr. Rajesh. Tax is deductible at source on maturity proceeds received by Mr. Brijesh and the tax deductible at source is ₹ 13,000
(d) No tax is deductible at source on maturity proceeds receivable by Mr. Rajesh. Tax is deductible at source on maturity proceeds received by Mr. Brijesh and the tax deductible at source is ₹ 10,000
2. ABC Ltd. took on sub-lease a building from Ms. Jhanvi with effect from 1.7.2022 on a rent of ₹ 20,000 per month. It also took on hire machinery from Ms. Jhanvi with effect from 1.10.2022 on hire charges of ₹ 15,000 per month. ABC Ltd. entered into two separate agreements with Ms. Jhanvi for sub -lease of building and hiring of machinery. Which of the following statements is correct with reference to ABC Ltd.'s liability to deduct tax at source, assuming that one-month's rent was received as security deposit, which is refundable at the end of the lease period?
(a) No tax needs to be deducted at source since rent for building does not exceed ₹ 2,40,000 p.a. and rent for machinery also does not exceed ₹ 2,40,000 p.a. Security deposit refundable at the end of the lease term is not rent for the purpose of TDS
(b) Tax has to be deducted@10% on ₹ 2,00,000 and @2% on ₹ 1,05,000 (i.e., rent including security deposit)
(c)Tax has to be deducted@10% on ₹ 1,80,000 and @2% on ₹ 90,000 (i.e., rent excluding security deposit)
(d) Tax has to be deducted@10% on ₹ 2,00,000 (i.e., rent including security deposit). However, no tax is to be deducted on rent of ₹ 1,05,000 (i.e., rent including security deposit) for machinery, since the same does not exceed ₹ 1,80,000
3. Mr. Vallish, employed as Manager with ABC Ltd., pays rent of ₹ 50,000 per month to his landlord. Which of the following statements is correct?
4. Mr. Hari is an interior decorator declaring profits under 44ADA in the P.Y.2022 -23 and the earlier previous years. Mr. Hari has to pay brokerage of ₹ 10 lakhs to Mr. Lal, a broker, to buy a residential house, and ₹ 50 lakhs to Mr. Shyam, a contractor for reconstruction of the residential house. Are TDS provisions attracted in the hands of Mr. Hari in respect of the above transactions?
5. Mr. Sanjay, a salaried individual, pays brokerage of ₹ 40 lakhs to Mr. Harish, a broker, on 5.1.2023 to buy a residential house. His father, Mr. Hari, a retired pensioner, makes contract payments of ₹ 15 lakhs, ₹ 25 lakhs and ₹ 12 lakhs on 28.9.2022, 3.11.2022 and 15.2.2023 to Mr. Rajeev, a contractor, for reconstruction of residential house. With respect to the above payments made by Mr. Sanjay and Mr. Hari, which of the following statements is correct?
6. Kunal & Co LLP engaged in manufacturing business withdrew from its bank account ₹ 125 lakhs by cash (each individual withdrawal does not exceed ₹ 2 lakhs) in the P.Y.2022-23. The purpose of withdrawal from bank was for buying agricultural produce, being raw material required for manufacture for finished products by it. Kunal & Co LLP always files its return of income before the due date. Are TDS provisions applicable on such withdrawals? If yes, what is the amount of tax to be deducted?
7. The following are details of cash withdrawals from Canara Bank by Mr. Ravish during the P.Y. 202223: – ₹ 16 lakhs on 27.05.2022 – ₹ 55 lakhs on 07.09.2022 – ₹ 28 Lakhs on 12.02.2023 Mr. Ravish has not filed his return of income for A.Y. 2020-21, A.Y. 2021-22 and A.Y. 2022-23. What is the amount of tax required to be deducted at source by Canara Bank on such withdrawals during the P.Y. 2022-23?
8. Mr. Ganesh is running a steel factory. The total turnover of the factory during the F.Y. 2021-22 amounted to ₹ 2.5 crores. The estimated turnover for F.Y. 2022-23 is likely to exceed ₹ 3 crore. On 10-04-2022, he availed consultancy services from a Delhi based chartered accountant. The consultancy fees amounted to ₹ 1,84,000. Should Mr. Ganesh deduct tax from consultancy fees of ₹ 1,84,000? If yes, then what shall be the amount of tax to be deducted and by when should the same be deposited with Government?
9. Mr. Harsh has to pay ₹ 3 lakhs on 3.3.2023 to “Plan your trip”, a travel agency, for a holiday package in Singapore and Malaysia for himself and his wife. He obtained a loan of ₹ 10 lakhs for higher education of his son studying in Columbia University, New York, on 20.3.2023 from SBI, and remitted, under LRS of RBI, the said sum through the same bank, SBI, which is also an authorised dealer. Is tax required to be collected at source from Mr. Harsh by travel agency and the bank? If so, how much?
10. Mr. Mahesh engaged in the business of trading of car accessories. His turnover for F.Y. 2021 -22 and F.Y. 2022-23 was ₹ 11.5 crore and ₹ 9.75 crore, respectively. XYZ Ltd. placed order for purchase of car accessories for ₹ 90 lakhs on 01.06.2022. Mr. Mahesh delivered the order within 15 days of receipt of order and received the payment within 7 days from the date of delivery. Is Mr. Mahesh required to collect tax at source on the consideration received by him from XYZ Ltd., if the turnover of XYZ Ltd. during the F.Y.2021-22 and F.Y.2022-23 was 15 crores and ₹ 17 crores, respectively? If yes, what is the amount of tax which he is required to collect at source? You may assume that XYZ Ltd. complies with all its TDS obligations.
