Comments on: Royalties and Fees for Technical Services in International Trade

By: Jatin

Jatin — Tue, 31 Aug 2010 05:42:46 +0000

What if the indian company is making reimbursement to Foreign Company. Do the indian company needs to withhold taxes u/s 195.

By: Prashant Maharishi

Prashant Maharishi — Thu, 03 Sep 2009 19:03:06 +0000

whether an Indian company has purchased one crane from a german company in 2005 of 1500 MT. now this crane is to be upgrded to 1750 MT and for that germany company is sedning data design to indian company . the exceution of work would be doen by netheralnd company. in that case whther the payemnst to german company is Royalties/ FTS and tax ios required to be deducted?

By: Kuldeep Kothari

Kuldeep Kothari — Wed, 10 Jun 2009 06:35:48 +0000

Whether payment made for downloading of photographs from various web sites i.e. corbis, etc for one time use that is for publishing them in to a magazine once would constitute Royalty and liable to withholding Tax?

By: Rahman

Rahman — Mon, 02 Mar 2009 16:17:22 +0000

@Srinivasan: Whether onshipping hire charges come within the ambit of either royalty or technical fees? I don’t think so, so the exclusion may be justified.

@Ritesh Jain: As for the first point, the position in taken by the SC in Ishikawajima was one which was in the line of thinking of Palkhivala (Kanga and Palkhivala on Taxation), and more importantly supported by common sense. Regrettably, the court in CIT v. Siemens (http://itatonline.org/archives/index.php/cit-vs-siemens-ag-bombay-high-court) had made a tentative statement that the position in Ishikawajima had been overcome by the Amendment. But in Clifford Chance (http://itatonline.org/archives/index.php/clifford-chance-uk-vs-dcit-bombay-high-court) the second proposition was not accepted. So I believe the ratio of Ishikawajima still holds good.

As for the second point, there is no question of application of service tax because service tax is leviable only on certain services, and technical services as defined in section 9(1)(vi) do not come within the purview of service tax.

By: Ritesh Jain

Ritesh Jain — Mon, 23 Feb 2009 04:42:38 +0000

So, if a indian co. has done contract with a non indian co.(which is o/s india) for technical services in which only paper comes to india i.e drawing which will be used in establishing a project in india by the indian co, the indian co. will not deduct TDS on the remittance made to non indian co.

What will be for service tax. Will be import of services as services are rendered out of india???????

By: anant pai

anant pai — Sat, 27 Dec 2008 06:05:36 +0000

good work put in.

By: srinivasan

srinivasan — Fri, 26 Dec 2008 17:31:15 +0000

point regarding TDS onshipping hire charges not covered.