Sec 195 and 115A

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anjali (Querist)
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13 May 2009 So basically Sec 115A would apply to the foreign co. to whom royalty is paid and sec 195 to the indian co. who is paying the royalty, isn't it??

taxindiaconnect

taxindiaconnect (Expert)
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13 May 2009 I believe you have not read the reply earlieer this question. Please read the reply again.

Section 115A provides the concessional rate on certain incomes of the non residents. For example the income of a non resident from royalty is taxed @ 10%
+ (SC and EC) under section 115A. while section 195 cast an obligation on the payer of the income to a non resident to deduct tax at source from the income. In the above expample since the income of the non resident is taxable at the prescribed rate u/s 115A, the payer has to deduct the tax at that rate u/s 195