TDS on Commission paid to Oversea Agent

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

04 June 2011 Co making paymant of Commission to their overseas Agent who arrenge the Client for Company to whom company sale its product. In such a case is there any laibility on Company to deduct TDS on amt paid to that Overseas Agent for transaction done by him outside india & such Agent is NR & don't have any respresenttative in India.

CA MANOJ GUPTA

CA MANOJ GUPTA (Expert)
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04 June 2011 1. As per section 9(1)(i), all income accruing or arising, whether directly or indirectly, inter alia, through or from any business connection in India, shall be deemed to accrue or arise in India; the expression "business connection" pre-supposes that the business is carried on in India by the non-resident

2. The commission amounts earned by the non-resident for the services rendered outside India are incapable of being deemed to be income accrued or arisen in India
under section 9
If the non-resident has no business connection in INDia then no income can be deemed to accrue or arise in india
hence no liab to deduct tax
SEE Dy CIT v EON Technology P Ltd -Delhi ITAT order
CA MANOJ GUPTA
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