20 April 2012
Case : Co.XYZ has hired ship from Co.PQR situated at Dubai for providing shipping services to Indian customers for 1 month & delivery of ship will be given to Co.XYZ in Indian port. Further Directors of Co.XYZ are in relation of directors of Co.PQR. I want to ask whether TDS will be deductible if Co.XYZ makes payment to Co.PQR u/s. Sec.195? or a Chartered Accountant can give Form 15CB for no deduction of TDS? If yes TDS is deductible then at what rate after considering DTAA provisions with Dubai?
21 April 2012
Dear Friend, first find out the rate of TDS chargeable in DTAA with dubai. Since the case if renting of ship or hire of shipping services from foreign party. The TDS will be deductible u/s. 195 of the Act.
21 April 2012
Since services are rendered in India Indian Income Tax Laws will be applicable and No DTA will apply for TDS. If any contract work of dragging is done within 25 noctive miles then it is within India and TDS has to be deducted let the ship owner get the credit under DTA of his country
CAclubindia
