Examine the applicability of Tax Deduction at Sources (TDS) or Tax Collection at Source (TCS) as per the Income Act, 1961 for the assessment year 2025-26 in the following independent situations : (a) PQR Pvt. Ltd sells t

Answer 4A(ii): (a) Sale of Motor Vehicle (TCS u/s 206C(1F)): PQR Pvt. Ltd. is not required to collect tax at source on sale of car of ₹ 4,00,000 to Mrs. Anjna since its value does not exceed ₹ 10 lakhs. However, it is required to collect tax at source u/s 206C(1F) @ 1% on sale of new car of consideration of ₹ 12 lakhs since the value of this car exceeds ₹ 10 lakhs. Tax has to be collected (TCS) at the time of receipt of ₹ 12 lakhs. (b) Rent Payment (TDS u/s 194-I): MNO Limited is required to deduct tax at source under section 194-I @ 10% on rent of ₹ 75,000 per month exclusive of GST component, since the aggregate rent of ₹ 9,00,000 during the financial year exceeds the threshold limit of ₹ 2,40,000. Tax has to be deducted at the time of payment or credit, whichever is earlier.