By Dr. V K Singhania


The CBDT has introduced some new provisions in order to keep a check on tax revenue leakage. Section 194R, and 194 S have been added to Finance Act 2022. These are applicable from 1st July 2022.

Basics of Section 194R 

  • The framework of the new Section 194R applicable from 01-07-2022 
  • What is envisaged within the meaning of benefit or perquisite? 
  • Who will be treated as the provider of benefit or perquisite? 

Fundamental Issues in Section 194R 

  • Is taxability of benefit or perquisite under Section 28(iv) mandatory for tax deduction under Section 194R? 
  • Does Section 194R apply to monetary benefit or perquisite? 
  • How to determine the nexus of benefit or perquisite with business or profession of deductee? 
  • At what stage of delivery of benefit or perquisite, tax be deducted? 
  • How is the value of benefit or perquisite to be determined? 
  • Can the CBDT Circular be binding on issues that do not address the removal of difficulties but enlarge the scope of tax liability? 

Practical issues in Section 194R 

  • Issues concerning computing the annual threshold limit of TDS of Rs. 20,000 
  • Issues concerning TDS where benefit or perquisite is provided in-kind 
  • Issues concerning reimbursement of business-related expenses 
  • Liability for TDS in case of promotional schemes run by a business entity and goods provided to social media influencers for publicity 
  • Liability for TDS in case of business conferences and similar events 
  • Impact of Section 194R on various businesses, including Pharma, FMCG 
  • Practical challenges in connection with deduction of tax under Section 194R 

194 S

Any person paying to any resident, any sum by way of consideration for transfer of virtual digital assets (VDA) TDS should be deducted.

TDS on payments other than salary

  • TDS under sections 192A, 194, 194C, 194-I, 194-IA, 194-IB,194J, 194K, 194M, 194N, 194-O, 194P, 194Q, 194 R, 194S and 195. 
  • Consequences of TDS defaults


Dr. Vinod K Singhania