I have query regarding payment made to foreign company by a Indian Company for subscription of online magazine .Whether Tds provisions is applicable to the assessee U/s sec 195 of the Income Tax Act.It would be great help if you give me the solution for same.
25 December 2011
Could be taxable under act. Refer sec 9.1.6 & 9.1.7. Also check dtaa provisions. Recent Samsung ruling applicability. Would depend nature of information from online magazine. Generally this is non taxable item.
26 December 2011
Dear Dinesh , in this case tax is not deductible provided the company publishing the magazine does not have any business connection in India, therefore no part of its income is deemed to accue or arise in India.
@ CA Abhishek Rana Thanks alot for the valuable information.I too thought the same.
@ CA.Anuj Gupta I refered the Wipro case Vide CIT vs Wipro Ltd vs ITO (2005)4(II)ITCL 268 (Bang "B" Trib):(2005)94 ITD 9(Bang-Trib):(2005)92 TTJ 796 (Bang Trib):2005 1 SOT 663(Bang-Trib).In this case bangalore tribunal favoured the assessee ie no need to deduct TDS.
So we have to follow the tribunal or the karnataka high court Sir.Please could you quote the case no of the high court judgement sir.Eagerly awaiting for the reply.Anyway thanks alot sir.
27 December 2011
@ CA Anuj Gupta ok Sir.So we have to deduct TDS, May i know at what rate it should be dedcuted incase the foreign compnay does not have PAN no.May i also know case no of the high court judgement.
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