Gourav (Student) (86 Points)
07 January 2010Hi friends,
Money is paid to an San Francisco Company for having a cyberspace monthly.. Is the amount liable for tds u/s 195?? The payment is made thru credit card.. if tax has to be deducted and if not deducted, then will it be liable for penalty??
Thank you
Amir
(Learner)
(4016 Points)
Replied 07 January 2010
Dear Gaurav,
Whether TDS is required to be deducted or not will depend upon whether this income is taxable in India or not..
Plz clarify that what kind of monthly cyberspace is that...Whether Entire part under this contract was performed outside India??? Whether Payment is made in India or not..
If TDS is required to be deducted, and assessee has not deducted than
1) Expense will not be allowed as deduction..
2) TDS alongwith Interest @ 1% has to be deposited.
3) Penalty equal to the amount of TDS may be imposed..
CA. Megha Topiwala
(Job)
(1534 Points)
Replied 07 January 2010
yeh.... reply 4m amir is correct.....
keep it up... amir...
Gourav
(Student)
(86 Points)
Replied 08 January 2010
The payment is made thru credit card for having some space in server of US.
Payment is made directly thru internet using credit card. It is a business expenditure..
and also let me know that purchasing some portion of server in foreign country comes under sec.9??
Thank you amir & megha..
Do reply wht to do?
J.K.Shahi
(Service)
(44 Points)
Replied 08 January 2010
Dear gourav
Kindly refer Millennium Infocom Tech Ltd.Vs ACIT 2009 117 ITD 114 Delhi
Payment made to Non Resident on account of rental for hosting of websites on servers are not in the nature of Royalties or fees for technical services or other sum chargeable to Tax in India .
The above case may help you.
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