Latest Expert Exchange Queries

GST Demo Service software link: https://ims.go2customer.com
Username: demouser Password: demopass
Get your inventory and invoicing software GST Ready from Binarysoft info@binarysoft.com
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
 
 
 
 
Popular Search: ARTICLES ON INPUT TAX CREDIT IN VAT :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: due date for vat payment :: ACCOUNTING STANDARD :: TDS :: VAT RATES :: cpt :: Central Excise rule to resale the machines to a new company :: empanelment :: list of goods taxed at 4% :: articles on VAT and GST in India :: ACCOUNTING STANDARDS :: form 3cd :: VAT Audit :: TAX RATES - GOODS TAXABLE @ 4%
 
 
From the Courts »
 BSES Rajdhani Power Ltd. Vs. Principal Commissioner Of Income Tax, Delhi-2
 Paradigm Geophysical Pvt. Ltd. Vs. Commissioner Of Income Tax (International Taxation)-3, New Delhi
 M/s Televista Electronics Ltd. Vs. Dy. Commissioner Of Income Tax
 The Commissioner Of Income Tax-Ii Vs. Mitsubishi Corporation India Pvt. Ltd
  SRD Nutrients Private Limited vs. CCE (Supreme Court)
 Samvardhana Motherson International Ltd. (Formerly Known As(M/s Samvardhana Motherson Finance Ltd.)a Vs. Assitant Commissioner Of Income Tax, Circle 22(1) & Anr.
 Pr. Commissioner Of Income Tax (Central)-2 Vs. M/s Frontline Business Solutions Pvt. Ltd. & Ors.
 Ram Kumar Vs. Income Tax Officer, Ward-64(2) & Anr.
 Principal Commissioner Of Income Tax-8 Vs. St Microelectronics Private Ltd.
  The Chamber Of Tax Consultants vs. UOI (Delhi High Court)
 M/s Ess Distribution (Mauritius) S.N.C.Et Compagnie Vs. Assistant Commissioner Of Income Tax, Circle -1(2)(2) International Taxation, New Delhi

No tax in India on sale outside country: AAR
April, 15th 2008

The Authority for Advanced Ruling (AAR) has clarified that tax is not liable to be deducted from the payments made to a non-resident if the transaction is a sale of equipment and repairs that took place outside India. The AAR is a quasi-judicial body for settling tax dispute.

The AAR ruled this on an application filed by the Airports Authority of India (AAI) regarding its transactions with US-based Raytheon. However, the AAR said tax is required to be deducted on a software maintenance contract AAI had with Raytheon. The agreement between AAR and Raytheon was for supply of equipment and training facilities. It also had an agreement for hardware repair and software maintenance.

The critical question put up before the AAR is this: Whether AAI is required to deduct tax in a case in which all activities took place outside the country? The AAI pointed out that all the activities including transfer of equipment and installation took place outside India. A substantial part of the activities related to software maintenance also took place outside India, except that an engineer was sent from India for the purpose of installation.

The AAR held that the payments made for hardware maintenance were not taxable in India and hence no need to deduct tax from the payment made to Raytheon. The AARs reasoning for this decision is based on the fact that hardware and equipment were sold outside India.

It also said the repair work was undertaken outside India. The AAR said having sent an engineer from India does not make a permanent establishment in India, under the terms of India-US Double Taxation Avoidance Agreement. But the AAR held that in case of payments made under the software development contract between the two, tax is liable to be deducted before making payment to Raytheon.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Careers

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions