Section 195

[CA Rachit Agarwal]

Company 'A' is a resident assessess. 'A' export some material to other country. Material is subject to analysis by a non resident of the country to which it exports. Company 'A' makes the payment for analysis charges to non-resident.

1. Whether the company is liable to deduct TDS on the analysis charges paid to non resident for the analysis carried out in the overseas country under section 195?

2. Whether the analysis income is chargeable to income tax in India?

[CAGOPALJI AGRAWAL]

In my view, the services would fall under fee for technical services and covered u/s 195. When the income is taxable, only then the withholding tax comes into play.

[CA Rachit Agarwal]

I want to know whether the same is chargeable under Income Tax Act.

[Surender Gupta]

As we know that to decide the taxability of a transaction would need many aspects to be looked into. What is analysis charges? How it is performed? Where it is performed? Therefore, in my view, given the facts and details in query, it is not possible to decide the same as final conclusion. An expert analysis is required for this.

AI Summary

Must Company 'A' Deduct TDS Under Section 195 for Overseas Analysis Charges? Exploring Taxability in India. Company 'A,' a resident entity, exports materials to another country and pays analysis charges to a non-resident for services performed overseas. The discussion focuses on whether Company 'A' must deduct TDS on these payments under Section 195 and if the income from such analysis is taxable in India. One participant suggests the services may be considered technical, thus subject to withholding tax if taxable. Another participant seeks clarity on its chargeability under the Income Tax Act, while a third emphasizes the need for further expert analysis due to the complexity and lack of detailed information.