Applicability of provisions of Section 44B

[ASHISH DESAI]

for delivering materials from mudra port to vizag port (i.e. within India ), we quite often use ships owned by a non-resident company based in U.A.E.My question is whether provisions of S.44B is applicable? I think,S.172 is not applicable to this case. though the quantum of TDS remains the same.the word regularity of business U/S S.44B is not specified. kindly advise.

[Ravi Chopra]

Since the ship is being owned by a non resident company based in U.A.E, either of the sections i.e. 44B and 172 are applicable depend on the nature of business - a regular business or occasional business. When you often use the services of a ship, it gives an impression that the ship is engaged in regular business.

AI Summary

Applicability of Section 44B depends on whether shipping services constitute a regular business, altering withholding obligations.
Determination of tax provision applicability for payments to a non resident shipowner for domestic carriage depends on the factual character and regularity of the shipping activity; frequent or recurring use suggests the ship is engaged in regular business and therefore the provision addressing regular business operations applies, whereas occasional use aligns with the provision for occasional transactions, affecting withholding and tax treatment.