Non Resident Company Vs. ITO's right

Tax planning 671 views 3 replies

Guest

As per the DTAA provision a company (which is registered outside india and operating from outside india) can also be treated as resident of india if it is proved that the effective management and control of the company is situated in india.

I have doubt on jurisdiction of indian income tax authorities as to serving a notice on such foreign companies.

Which provision of DTAA or IT Act provides the right to Indian IT Authorities to serve notice on such foreign company? Whether they can ask for any information or documents?

Whether such foreign company is obliged to reply such notice served by the Indian IT Authorities?

If the company dont reply, then what are the provision for penal action?

Note: All the owner and staff of the comapny are NRI and the company is not having any permanent establishment in INDIA.

please discuss...

Replies (3)

U S Sharma

glidor@gmail.com

21068 Points Joined January 2010

if it is proved that the effective management and control of the company is situated in india.

the question itself contain reply :)

Guest

for proving the same, IT department needs some information / documents from the NRI company.

How IT dept will be able to get such information??

Whether IT dept. have any right to ask NRI company for any of the information or documents?

If yes then which act / law provides such right to IT dept..

Thanks

U S Sharma

glidor@gmail.com

21068 Points Joined January 2010

IT department has own source of information, and on their belief only they issue such notices, may be some transaction done by such company has violated the IT rules.