Tds on testing charges (urgent..)?

Hi Friends,

A Private Ltd. Co. has paid Testing Charges around Rs. 60 Lacs to a non resident company i.e canadian company without deducting TDS. However the non resident has no permanent establishment in India. 

Now my question is whether TDS should have deducted on this transaction under sec. 195 or any other section.

Please give the reference of the section for the above transaction and if TDS applicable than rate & Section also.Whether DTAA provision will be applicable here, and if yes then want to know that provision also.