INCOME TAX ACT, 1961

Section 195 Section 201(1) Section 201(1A)

Tax deduction at source - Under section 195 - Travelling expenses, research expenses, seminar expenses, training and conference expenses -

Certain payments for travelling, etc., made by the assessee to non-resident on which no tax was deducted at source and the AO was of the firm belief that the payments made to non-resident were subject to withholding tax in India. AO came to the conclusion that such payments made by the assessee attracted withholding tax provisions. Assessee agitated the matter before the CIT(A) but without any success. Assessee stated that all the payments made to non-resident were reimbursement of travel expenses, research expenses and seminar, training and conference expenses. It was the say of the counsel that all the reimbursement were duly supported by the invoices along with certificate of the Chartered Accountant.Held: There was no hesitation in holding that the payments made by the assessee in respect of travel expenses, research expenses, seminar, training and conference expenses were nothing but reimbursements of expenses without any profit element and therefore, the assessee was not liable for withholding tax under section 195.

Relied:Kruppl Udhe GmbH (2013) 354 ITR 173 (Bom-HC) : 2010 TaxPub(DT) 1639 (Bom-HC) and Industrial Engg. Projects (P) ltd. (1993) 202 ITR 1014 (Del-HC) : 1993 TaxPub(DT) 505 (Del-HC).

REFERRED :

FAVOUR : In assessee's favour.

A.Y. : 2008-09

INCOME TAX ACT, 1961

Section 9(1)(vi)

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