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TDS on freight paid to associated enterprieses !

TDS / TCS 541 views 1 replies

Hi All,

I hv brought an interesting practical issue !

An Indian company engaged in the business of logistics, whose foreign holding company supplies cargo to this Indian company and further this Indian comapny forward the goods to its customers. Its Customers deduct TDS on the payment made by them to this Indian company,

Now the question is that when this Indian company pays the cost to its foreign holding company, shall it be liable to deduct TDS?

 

It is interesting to note that section 195 only covers this transaction, but anyhow can it be said that holding company has business connection in India and thus payment made is the income deemed to accrue and arise in India ?

Please give the circular and DTAA reference if any is there.

 

Thank You

Replies (1)
Originally posted by : Mitesh Kr. Shah

Hi All,


I hv brought an interesting practical issue on transfer pricing matters....!!!
 

An Indian company engaged in the business of logistics, whose foreign holding company supplies cargo to this Indian company and further this Indian comapny forward the goods to its customers. Its Customers deduct TDS on the payment made by them to this Indian company,


Now the question is that when this Indian company pays the cost to its foreign holding company, shall it be liable to deduct TDS?
 
It is interesting to note that section 195 only covers this transaction, but anyhow can it be said that holding company has business connection in India and thus payment made is the income deemed to accrue and arise in India ?
 

Please give the circular and DTAA reference if any is there.
 
Thank You


CCI Pro

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