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Applicability of section 195

abhimanyu (proprietor) (53 Points)

09 May 2015

I have a query as follows: My client is importing raw material from outside India on C.I.F basis Weather section 195 will be applicable in this case and withholding be done in this case?

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2 Replies

Bhav Bhuti Sharma (Towards Professionalism ) (823 Points)
Replied 09 May 2015

TDS is not required to be deucted for import of goods if the transaction is on principal to principal basis and further the foreign exporter does not have a permanent establishment in India. As per SC ruling. Provisions of section 195 and 206 AA do not get attracted on import of goods. However where import involves payment for royalty or technical servicess ( in case of import of machinery) the provisions of TDS get applicable.