Payment to a hospital: whether Fees for Technical services

Ashish Sharma (Partner) (30 Points)

19 June 2009  

Hospital A and Hospital B (both being registered companies) entered in a contract whereby Hospital A will provide its staff for carrying out certain procedures to Hospital B. The staff so provided will include Doctors, Nurses and other Technical staff.

What will be the nature of payment that Hospital B will be making to Hospital A?

Since the receipient is a Company, it cannot be professional fee, as courts have held that a company cannot be in profession. But can this be qualified as Fees for Technical Services?