23 September 2008
Payer is a Bank (Say, A Ltd). It is financing the Vehicles for variuos Dealers (Say, B lTd).The Dealer (B ltd) regularly gives free insurance to the customers who purchased vehicle from them through financing by A lTd. Dealer (B Ltd) raises invoice on Bank (A Ltd)for reimbursement of Insurance charges given to customers. Whether Bank (Altd) needs to pay FBT on this kind of payment under "sales promotion" head? And also whether TDS needs to be deducted on such payment? If yes then under which section? Please advise.
CAclubindia
