Chartered Accountants
20 Points
Joined January 2008
Its depend whether such indian company is an agent of such foreign shipping company. if yes, then U/s 172 of income tax override the income tax and provision of Sec. 194 & 195 will not be applicability. and no ned to deduct the tax on Ocean freight and expenses linked with such shipment.
further such indian company have to produce the certificate from income tax department, that being an agent of foreign shipping line tds provision will not be applicable for a specific period ( Income ta x department issue such certificate for one yera. it need renew to such certificate every year.
Apart from that there isa circular issued by income tax department long time back , according to that, countries with which we have a double taxation avoid agreement , need not to deduct TDS on payment made to foreign shipping companies and their agent in india.