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“withholding tax”

TDS / TCSSection 195Section 195663 judgments

The decision most relied on for withholding tax is Engineering Analysis Centre of Excellence (P) Ltd. v. CIT (432 ITR 471), cited in 914 judgments on BharatTax.

Leading authorities on withholding tax

Engineering Analysis Centre of Excellence (P) Ltd. v. CIT
432 ITR 471 · 2021 · Supreme Court
914
citing judgments

Payments for the supply or use of computer software, where there is no transfer of copyright but only a right to use the copyrighted product, are generally considered business profits and not 'royalty' or 'fees for technical services' under the Income Tax Act, 1961 or relevant DTAAs. This principle also applies to transponder fees, which are not taxable as royalty.

GE India Technology Centre Pvt. Ltd. v. CIT
327 ITR 456 · 2010 · Supreme Court
663
citing judgments

Tax must be deducted at source from payments made to a non-resident under Section 195 only if such payment is chargeable to tax in India. The Assessing Officer bears the onus to establish that the payments made are indeed chargeable to tax under the Income Tax Act.

CIT v. De Beers India Minerals (P.) Ltd.
346 ITR 467 · 2012 · High Court
371
citing judgments

For fees for technical or consultancy services to 'make available' technical knowledge or know-how under a DTAA, the service must transmit such knowledge, allowing the recipient to derive an enduring benefit and utilize it independently in the future.

Asia Satellite Telecommunications Co. Ltd. v. DIT
332 ITR 340 · 2011 · High Court
359
citing judgments

Payments for the use of equipment, such as satellite transponders, do not constitute 'royalty' under Section 9(1)(vi) of the Income-tax Act, 1961, or under applicable tax treaties, especially when there is no transfer of the right to use a process or underlying technology.

DIT v. New Skies Satellite BV
382 ITR 114 · 2016 · High Court
325
citing judgments

An amendment to the Income Tax Act, such as the Finance Act, 2012 amendment to Section 9(1)(vi) defining royalty, does not automatically override or alter the definition of 'royalty' as provided in a Double Taxation Avoidance Agreement (DTAA) unless the DTAA itself is bilaterally amended. The definition of royalty in a DTAA remains unaffected by unilateral changes to domestic law.

CIT v. Siemens Aktiongesellschaft
310 ITR 320 · 2009 · High Court
259
citing judgments

Reimbursements of actual expenses without any profit element are not taxable income. Additionally, mere amendments to the Income-tax Act do not override the provisions of Double Taxation Avoidance Agreements (DTAAs).

Transmission Corporation of Andhra Pradesh v. CIT
239 ITR 587 · 1999 · Supreme Court
243
citing judgments

The Supreme Court lays down principles for deducting tax at source (TDS) under Section 195 on payments to non-residents, including aspects of income deemed taxable in India and the application of Double Taxation Avoidance Agreements (DTAAs) under Section 90.

CIT v. Eli Lily & Co.
312 ITR 225 · 2009 · Supreme Court
221
citing judgments

Section 195 of the Income Tax Act, which mandates tax withholding on payments to non-residents, applies only to sums that are otherwise chargeable to tax under the Act. Tax withholding provisions are not charging provisions.

Judgments citing withholding tax

Rajesh Kumar Agarwal, Jaipur vs. DCIT, Circle 1, Jpr

In the result, appeal of the assessee is allowed

ITA 85/JPR/2023[2021-22]Status: HeardITAT Jaipur17 Apr 2023AY 2021-22

Bench: The Date Of Hearing Of Appeal.”

For Appellant: Smt. Suhani Meharwal (C.A.)For Respondent: Sh. A. S. Nehra (Addl. CIT) a
Section 139(1)Section 143(1)Section 143(1)(a)Section 44ASection 80J

amount of Rs. 51,21,024/- claimed by the assessee, a sum of Rs. 24,78,391/- was not allowed, for the reason, that withholding tax had not been deducted by the assessee. 13.2 It is pertinent to note that the assessee had disclosed the same in its statement/communication dated

Grant Thornton India LLP, New Delhi vs. JCIT, Range- 52, New Delhi

In the result, the appeal is allowed

ITA 274/DEL/2019[2013-14]Status: DisposedITAT Delhi31 Mar 2023AY 2013-14

Bench: Shri G.S. Pannu & Shri Saktijit Deyassessment Year: 2013-14

Section 40

Officer noticed that in the year under consideration, the assessee had paid professional fee amounting to Rs.33,06,542 to various overseas entities without withholding tax at source. 5. Noticing this, the Assessing Officer called upon the assessee to explain why the payments made should not be disallowed under Section ... residents are not taxable in India in absence of Permanent Establishment (PE), there was no obligation on the part of the assessee to withhold tax at source. The assessee further submitted, the payment made cannot be treated as either royalty or Fee for Technical Services (FTS}. The assessee submitted

Lahmeyer Holding Gmbh, Germany vs. DDIT, New Delhi

In the result, the appeals are partly allowed

ITA 5615/DEL/2011[2008-09]Status: DisposedITAT Delhi31 Mar 2023AY 2008-09

Bench: Shri G.S. Pannu, Hon’Ble & Shri Saktijit Deyassessment Year: 2008-09 Lahmeyer International Vs. Ddit, Gmbh, Circle-3(2), Friedberger Strasse 173, International Taxation, 61118 Bad Vilbel, New Delhi Deutschland (Germany) Pan :Aaacl6802E (Appellant) (Respondent) With Assessment Year: 2008-09 Lahmeyer Holding Gmbh Vs. Ddit, (Formerly Lahmeyer Circle-3(2), International International Gmbh), Taxation, Friedberger Strasse 173, New Delhi 61118 Bad Vilbel, Deutschland (Germany) Pan :Aaacl6802E (Appellant) (Respondent)

Section 234BSection 234CSection 271(1)(c)Section 44D

Initiating penalty proceedings under section 271(1)(c) of the Act for Assessment Year 2008-09, which is inappropriate. 6. Not granting credits for withholding taxes deducted by customers of the Appellant amounting to Rs.27,841,806 at the time of computing the tax demand for the Appellant

Lahmeyer International Gmbh, Germany vs. DDIT, New Delhi

In the result, the appeals are partly allowed

ITA 5614/DEL/2011[2008-09]Status: DisposedITAT Delhi31 Mar 2023AY 2008-09

Bench: Shri G.S. Pannu, Hon’Ble & Shri Saktijit Deyassessment Year: 2008-09 Lahmeyer International Vs. Ddit, Gmbh, Circle-3(2), Friedberger Strasse 173, International Taxation, 61118 Bad Vilbel, New Delhi Deutschland (Germany) Pan :Aaacl6802E (Appellant) (Respondent) With Assessment Year: 2008-09 Lahmeyer Holding Gmbh Vs. Ddit, (Formerly Lahmeyer Circle-3(2), International International Gmbh), Taxation, Friedberger Strasse 173, New Delhi 61118 Bad Vilbel, Deutschland (Germany) Pan :Aaacl6802E (Appellant) (Respondent)

Section 234BSection 234CSection 271(1)(c)Section 44D

Initiating penalty proceedings under section 271(1)(c) of the Act for Assessment Year 2008-09, which is inappropriate. 6. Not granting credits for withholding taxes deducted by customers of the Appellant amounting to Rs.27,841,806 at the time of computing the tax demand for the Appellant

Serco India Pvt. Ltd., Pune vs. ACIT, Circle-4(1), Gurgaon

In the result, the appeal of the assessee is dismissed

ITA 1187/DEL/2018[2014-15]Status: DisposedITAT Delhi16 Feb 2023AY 2014-15

Bench: Shri Chandra Mohan Garg & Shri Pradip Kumar Kedia

For Appellant: Shri Suraj Bhan Nain, AdvFor Respondent: Shri Kumar Pranav, Sr.DR
Section 115BSection 143(3)Section 271(1)(c)Section 68

erred in not providing sufficient time considering that the Appellant was in the process of collecting various evidences such as withholding tax documents/ information from the jurisdictional TDS officer which were crucial evidence to substantiate its claims made in the appeal. 6. That the Ld. AO ignored the fact that

M/S. Cobra Instalaciones Y Servicios S.A., New Delhi vs. ADIT, New Delhi

ITA 6602/DEL/2013[2006-07]Status: DisposedITAT Delhi13 Feb 2023AY 2006-07

Bench: Shri N. K. Billaiya & Shri Anubhav Sharma

For Appellant: Sh. Hiren Mehta, CAFor Respondent: Sh. Sanjay Kumar, Sr. DR
Section 115JSection 143(3)Section 40Section 40a

upholding disallowance of an amount of Rs.5,45,00,895/- by applying the provisions of Section 40(a) (i) on the plea that no withholding tax in respect of payments made to M/s Ineco & M/s Enotrac was made. 3. That on the facts and circumstances of the case ... upholding disallowance of an amount of Rs.3,42,24,888/- by applying the provisions of Section 40(a) (i) on the plea that no withholding tax in respect of payments made to M/s Ineco & M/s Enotrac and M/s. Hilton Engineering BV was made. 3. That on the facts and circumstances

M/S. Cobra Instalaciones Y Servicios S.A., New Delhi vs. ADIT, New Delhi

ITA 6601/DEL/2013[2005-06]Status: DisposedITAT Delhi13 Feb 2023AY 2005-06

Bench: Shri N. K. Billaiya & Shri Anubhav Sharma

For Appellant: Sh. Hiren Mehta, CAFor Respondent: Sh. Sanjay Kumar, Sr. DR
Section 115JSection 143(3)Section 40Section 40a

upholding disallowance of an amount of Rs.5,45,00,895/- by applying the provisions of Section 40(a) (i) on the plea that no withholding tax in respect of payments made to M/s Ineco & M/s Enotrac was made. 3. That on the facts and circumstances of the case ... upholding disallowance of an amount of Rs.3,42,24,888/- by applying the provisions of Section 40(a) (i) on the plea that no withholding tax in respect of payments made to M/s Ineco & M/s Enotrac and M/s. Hilton Engineering BV was made. 3. That on the facts and circumstances

Matrix Cellular International Services Ltd., New Delhi vs. JCIT, Special Range- 6, New Delhi

In the result, the appeal is partly allowed

ITA 6916/DEL/2019[2016-17]Status: DisposedITAT Delhi18 Jan 2023AY 2016-17

Bench: Sh. G. S. Pannu, Hon’Ble & Sh. Saktijit Dey

For Appellant: Sh. A. K. Khanna, CAFor Respondent: Sh. Sanjay Kumar, Sr. DR
Section 195Section 40

International Services Ltd. Officer noticed that during the year under consideration, the assessee has debited certain expenditure, being payment made to overseas entities, without withholding tax under section 195 off the Act. Therefore, he called upon the assessee to explain why such payment made should not be disallowed under section ... nature of business profit is not taxable in India. That being the factual position, there was no obligation on the assessee to withhold tax at source under section 195 of the Act while making such payment. At this stage, we must observe, the Assessing Officer while disallowing the payment under

Fil India Business & Research Services P.Ltd, New Delhi vs. Dc, Circle-7(1), New Delhi

In the result, appeal of the assessee is partly allowed

ITA 1358/DEL/2022[2018-19]Status: DisposedITAT Delhi17 Jan 2023AY 2018-19

Bench: Sh. Anil Chaturvedi & Sh. Chandra Mohan Gargfil India Business & Vs. Dc Research Services P. Ltd., Circle – 7(1) Private Studio – New Delhi Ncr/Ac/Ps/00/010B, Ground Floor, Worldmark 1, Asset Area 11, Aerocity, Hospitality District, Indira Gandhi International Airport, New Delhi-110 002 Pan : Aabcf 1572 C (Appellant) (Respondent) Assessee By Shri K. M. Gupta, Adv. Shri Rishabh Malhotra, A.R. & Shri Bhavya Gupta, C.A. Revenue By Shri Amaresh Singh, Cit-D.R. Date Of Hearing: 21.12.2022 Date Of Pronouncement: 17.01.2023 Order Per Anil Chaturvedi, Am :

Section 139Section 139(1)Section 143(2)Section 143(3)Section 144CSection 144C(13)Section 144C(2)Section 144C(5)Section 36(1)(va)Section 43B

concluding that the decisions relied upon by the Appellant in respect of the technical glitches are with regards to the delay in filing withholding tax returns without considering the principles drawn from the case laws. 2.4 The Ld. AO/ Ld. DRP erred in not appreciating the principle laid down

Travelport International Operations Limited, Berkshire vs. ACIT Circle-3(1)(1) International Taxation-3, New Delhi

In the result, the appeals are partly allowed

ITA 1567/DEL/2022[2019-20]Status: DisposedITAT Delhi10 Jan 2023AY 2019-20

Bench: Shri G.S. Pannu, Hon’Ble & Shri Saktijit Dey

Section 143(3)Section 144C(13)

entire amount (100%) claimed by the assessee on account of other expenses such as royalty, vendor cost, license fee owing to non-deduction of withholding tax. From the above table, the position of the profit/loss of the assessee is evident. After deduction of the distribution expenses and 15% booking

Travelport International Operations Limited, Berkshire vs. ACIT Circle-3(1)(1), International Taxation-3, New Delhi

In the result, the appeals are partly allowed

ITA 1566/DEL/2022[2018-19]Status: DisposedITAT Delhi10 Jan 2023AY 2018-19

Bench: Shri G.S. Pannu, Hon’Ble & Shri Saktijit Dey

Section 143(3)Section 144C(13)

entire amount (100%) claimed by the assessee on account of other expenses such as royalty, vendor cost, license fee owing to non-deduction of withholding tax. From the above table, the position of the profit/loss of the assessee is evident. After deduction of the distribution expenses and 15% booking

Yamazen Machinery Tools India P.Ltd, New Delhi vs. ACIT, Circle-27(2), New Delhi

In the result, the appeal is partly allowed

ITA 582/DEL/2020[2015-16]Status: DisposedITAT Delhi10 Jan 2023AY 2015-16

Bench: Shri G.S. Pannu, Hon’Ble & Shri Saktijit Deyassessment Year: 2015-16

Section 192Section 195Section 40Section 9

read with Article 12 of India – Japan Double Taxation Avoidance Agreement (DTAA), and since, the assessee has failed to withhold tax under section 195 of the Act in respect of such payment, why the payment should not be disallowed under section 40(a)(i) of the Act. In response ... supra], has held as under: “30. The DRP has affirmed the decision of the Ld. AO by holding that the assessee has deducted withholding tax on 21 substantial payments and yet argued that the tax is not deductible u/s 195 of the act and provision of section

M/S. Applied Materials India Private Limited, Bangalore vs. Deputy Commissioner of Income Tax, Circle- 1(1)(1), Bangalore

In the result, the appeal filed by the assessee stands partly allowed

ITA 2582/BANG/2019[2015-16]Status: DisposedITAT Bangalore30 Dec 2022AY 2015-16

Bench: Shri Chandra Poojari & Smt. Beena Pillai

For Respondent: Shri T. Suryanarayana

travel expenses Rs. 2,83,70,976/- Recovery of CSR expenses Rs. 37,63,400/- Reimbursement of training Rs. 93,483/- expenses Recovery of withholding taxes of employees on restricted stocks unit and ESOP granted Rs. 7,47,14,054/- and remitted to local tax authorities Page

Amee Foster Wheeler India Pvt. Ltd., Chennai vs. ACIT, Corporate Range-1, Chennai

In the result, the appeal filed by the assessee is partly allowed for statistical purposes

ITA 680/CHNY/2020[2014-15]Status: DisposedITAT Chennai22 Dec 2022AY 2014-15

Bench: Shri Mahavir Singhand Shri Manoj Kumar Aggarwalआयकर अपील सं./Ita No.: 680/Chny/2020 िनधा"रण वष"/Assessment Year: 2014-15 Amec Foster Wheeler India Pvt. The Acit (Osd), Ltd., Vs. Corporate Range -1, Zenith Building, 6Th Floor, Chennai Ascendas It Park, Csir Road, Taramani, Chennai – 600 113. Pan : Aaacf 3204C (अपीलाथ"/Appellant) (""यथ"/Respondent) अपीलाथ" क" ओर से/Appellant By : Ms. K.Amulya, Ca & Ms. V. Rajeswari, Ca ""यथ" क" ओर से/Respondent By : Shri S. Marudhu Pandyan, Cit सुनवाई क" तार"ख/Date Of Hearing : 22.12.2022 घोषणा क" तार"ख/Date Of Pronouncement : 22.12.2022 आदेश /O R D E R Per Mahavir Singh: This Appeal By Assessee Is Arising Out Of The Order Of The Commissioner Of Income Tax (Appeals)-4, Chennai In Ita No.479/16-17/Cit(A)-4/A.Y.2014-15 Dated 06.02.2020. The Assessment Was Framed By The Acit(Osd), Corporate Range-1, Chennai For The Assessment Year 2014-15, U/S.143(3) Of The Income Tax Act, 1961 (Hereinafter The ‘Act’), Vide Order Dated 29.12.2016. 2. The First Issue In This Appeal Of Assessee Is As Regards To The Order Of Cit(A) Confirming The Action Of Ao In Making Disallowance Of Cost Incurred In Connection With Off The Shelf Software Products Treating The Same As Royalty Under The Provisions Of The Act Read With Relevant Treaties. For This, Assessee Raised Ground Nos. 2 To 4 But The Relevant Ground Is Ground No.2, Which Reads As Under:- “2. The Ld. Cit(A) & Ld. Ao Erred In Non-Consideration Of The Fact That The Said Expenditure Merely Represents Cost To Cost Reimbursement Of Expenditure Incurred On Behalf Of The Appellant By Afwg Overseas Entities & Therefore, No Income Arises In The Hands Of Afwg Entities Necessitating The Obligation To Withhold Taxes On The Part Of The Appellant Under The Provisions Of The Act.”

For Appellant: Ms. K.Amulya, CA &For Respondent: Shri S. Marudhu Pandyan, CIT
Section 143(3)Section 40Section 9(1)(vi)Section 9(1)(vii)

behalf of the Appellant by AFWG overseas entities and therefore, no income arises in the hands of AFWG entities necessitating the obligation to withhold taxes on the part of the Appellant under the provisions of the Act.” 3. Briefly stated facts are that during the financial year 2013-14 relevant ... hands of the Amec Foster Wheeler Group overseas entities with respect to such cost to cost reimbursement and hence the question of withholding tax does not arise. The AO treated the transaction as royalty by holding that as per the provisions of section

Mr Ashok Madhav Rao, Mumbai vs. Asstt. Director of Income Tax, CPC, Bangalore

In the result, the appeal of the assessee is allowed for statistical purposes

ITA 1288/MUM/2022[2018-2019]Status: DisposedITAT Mumbai19 Dec 2022AY 2018-2019

Bench: Shri Prashant Maharishi, Am Assistant Director Of Income Tax, Mr. Ashok Madhav Rao Centralized Processing Flat No. 103, Dheeraj Centre, Dashan 2, Kokan Nagar, Vs. Jogeshwari (East), Mumbai- Income Tax Department, 400 060 Bengaluru, Karnataka-560 500 (Appellant) (Respondent) Pan No. Afirp8784B Assessee By : Ketan Ved Revenue By : Shri Ujjawal Chavan Sr Ar Date Of Hearing: 20.09.2022 Date Of Pronouncement: 19.12.2022

For Appellant: Ketan VedFor Respondent: Shri Ujjawal Chavan SR AR
Section 143(1)Section 90

furnished by the assessee also clearly shows what is the amount of salary received by him from Netherlands and what is the amount of withholding tax paid by him through his employers in Netherlands. Now the fiscal report 2017 on behalf of the assessee is also available which is also

Ramesh Flowers Private Limited, Tuticorin vs. ITO(International Taxation), Tuticorin

The appeal stand allowed

ITA 70/CHNY/2021[2020-21]Status: DisposedITAT Chennai07 Dec 2022AY 2020-21

Bench: Hon’Ble Shri Mahavir Singh & Hon’Ble Shri Manoj Kumar Aggarwal, Am

For Appellant: Shri D. Anand (Advocate)-Ld. ARFor Respondent: Shri S. Senthil Kumaran (CIT)–Ld. DR
Section 194Section 194LSection 201(1)Section 263

borrowings. Therefore, the borrowings do not fulfil the conditions prescribed u/s 194LC. The CBDT circulars clearly spelt out that the Sec.194LC applies for withholding tax rate of 5% on interest payment made by Indian companies on borrowings made in foreign currency by such companies from a source outside India. Accordingly

Deputy Commissioner of Income Tax, Central Circle-2(4), Bangalore vs. Century Real Estate Holdings Private Limited, Bangalore

In the result, the appeal of the assessee is partly allowed

ITA 740/BANG/2022[2013-14]Status: DisposedITAT Bangalore30 Nov 2022AY 2013-14

Bench: Shri Chandra Poojari & Smt. Beena Pillaiassessment Year: 2013-14

For Appellant: Smt. Sheetal Borkar, A.RFor Respondent: Shri Gudimella V.P. Pavan Kumar, D.R

CREH under this letter are exclusive of taxes. (service taxes, of any other such tax) SCANIA can, however, if required by law, deduct withholding taxes at source and make the balance payments to CREH while forwarding the tax certificates etc. in order for CREH to claim the said tax credits

Century Real Estate Holdings Private Limited, Bangalore vs. Deputy Commissioner of Income Tax, Central Circle-2(2), Bangalore

In the result, the appeal of the assessee is partly allowed

ITA 580/BANG/2022[2013-14]Status: DisposedITAT Bangalore30 Nov 2022AY 2013-14

Bench: Shri Chandra Poojari & Smt. Beena Pillaiassessment Year: 2013-14

For Appellant: Smt. Sheetal Borkar, A.RFor Respondent: Shri Gudimella V.P. Pavan Kumar, D.R

CREH under this letter are exclusive of taxes. (service taxes, of any other such tax) SCANIA can, however, if required by law, deduct withholding taxes at source and make the balance payments to CREH while forwarding the tax certificates etc. in order for CREH to claim the said tax credits

M/S. Sartorius Stedim India Private Limited, Bangalore vs. Assistant Commissioner of Income Tax, Circle- 6(1)1), Bangalore

In the result, the appeal filed by the assessee stands partly allowed

ITA 1695/BANG/2019[2012-13]Status: DisposedITAT Bangalore28 Nov 2022AY 2012-13

Bench: Shri Chandra Poojari & Smt. Beena Pillaiit(Tp)A No. 1695/Bang/2019 Assessment Year : 2012-13 M/S. Sartorius Stedim India Pvt. Ltd., The Assistant No. 69/2 & 69/3, Commissioner Of Kunigal Road, Income Tax, Jakkasandra, Circle – 6(1)(1), Nelamangala, Vs. Bangalore. Bengaluru – 562 123. Pan: Aabcs7591Q Appellant Respondent : Shri Narendra Kumar Jain, Assessee By Ca : Shri Venudhar Godesi, Revenue By Jcit-Dr Date Of Hearing : 28-10-2022 Date Of Pronouncement : 28-11-2022 Order Per Beena Pillaipresent Appeal Is Filed By Assessee Against The Order Dated 20/05/2019 Passed By The Ld.Cit(A) For A.Y. 2012-13 On Following Grounds Of Appeal: “General Ground 1. The Order Of The Learned Commissioner Of Income Tax (Appeals)-6 (Hereinafter Referred To As Cit(A)) To The Extent Prejudicial To The Appellant Is Bad In Law. Transfer Pricing - General Grounds 2. The Learned Cit(A) Has Erred In Confirming The Action Of The Ao & Tpo In: A) Making A Reference For The Determination Of The Arm'S Length Price Of The International Transactions To The Tpo

For Respondent: Shri Narendra Kumar Jain

deduction of TDS without appreciating that software purchased was capitalised and only depreciations was claimed on it; (ii) Not appreciating that the requirement for withholding tax on purchase of software was mandated vide Finance Act 2012 which was not in force when the Appellant complied with TDS provisions

M/S. Praxair India Private Limited, Bengaluru vs. Deputy Commissioner of Income Tax, Circle-3(1)(1), Bangalore

In the result, both the appeals of the assessee in IT(TP)A No

ITA 199/BANG/2021[2015-16]Status: DisposedITAT Bangalore22 Nov 2022AY 2015-16

Bench: Shri Chandra Poojari & Smt. Beena Pillai

For Appellant: Shri T. Suryanarayana, Senior A.RFor Respondent: Shri K. Sankar Ganesh, D.R
Section 143Section 143(3)Section 92C

BITC belongs to second group of aforementioned rules; it recharacterizes certain interest payments into dividends both for corporate tax purposes of debtor and for withholding tax purposes, while curiously it does not recharacterize debt into equity (neither for corporate tax, nor for capital duty purposes). In certain circumstances, the Belgian