Taxability of branch interest: interest remitted to foreign head offices is taxable in India and requires tax deduction at source. The branch of a foreign concern in India is a separate entity for tax purposes; interest paid or payable by that branch to its head office or any overseas branch is liable to tax in India, subject to any lower rate under an applicable double taxation avoidance agreement, and tax must be withheld on such remittances in accordance with provisions relating to tax deduction at source.