Friday, 8 February 2013

NO TDS ON PAYMENT MADE TO NOVATEL


S. 9(1)(vii): Income deemed to accrue or arise in India –Fees for technical services-Payment towards voice charges – Services neither managerial, technical or consultancy nature – Hence, no fees for technical services. (S. 40(a)(ia), 195)
Where assessee engaged in business of IT enabled services, made payments to Novatel, a U.S. company, towards voice charges, income of Novatel was in form of service charges payment and Novatel had not rendered services of managerial, technical or consultancy nature hence the assessee had no obligation to to deduct tax at source from payment made, to Novatel, therefore disallowance cannot be made. (AY 2008-09

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