Tds u/s 195

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This query is : Resolved

sanath (Querist)

05 August 2011 The US Holding company has bought the license for a login, and uses the same during it's day time.

The Indian subsidiary company, uses the same login and uses the license during the day time.(Night time in US)

The indian company is reimbursing the US holding company, on the cost portion only, on the basis of Hours usage.
It may again be noted that only the cost is shared.

Will this attract TDS u/s 195?
What is the correct stand in the current scenario?

CA. Anoop Gadia

CA. Anoop Gadia (Expert)

06 August 2011 Other is not service contract. both company share a service from other service provider so other is no need of TDS deduction.

Arihanth Jain

Arihanth Jain (Expert)

06 August 2011 My views differ from the above and I believe that TDS may apply depending upon the nature of service. However DTAA may also be reffered for anyspecific exemptions.

Message likes : 1 times

sanath

sanath (Querist)

06 August 2011 Thanks for your replies.
I read a Dunlop case law in favour of non deduction of tds.

Any case laws specifically pertaining to the above?

Arihanth Jain

Arihanth Jain (Expert)

06 August 2011 Request you detail more on the nature of license so that we can decide what nature of transaction it falls in i.e., technical service, royalty etc.,

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