https://www.taxtmi.com/caselaws?id=471675 Bank guarantee commission paid before 1 January 2013 did not attract tax deduction requirements applicable to commission or brokerage because those requirements depend on a principal-agent relationship. A bank issuing a guarantee gives an independent undertaking to the beneficiary for consideration and acts on a principal-to-principal basis, rather than as the payer's agent. The payment is therefore a banking-service fee, not commission or brokerage subject to tax deduction. A later exemption for specified payments to banks did not change this characterisation for the earlier period. Consequently, disallowance for non-deduction of tax from bank guarantee fees was unsustainable. en-us Thu, 23 Sep 2021 00:00:00 +0530 Mon, 14 Sep 2026 14:22:19 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=471675 Bank guarantee commission paid before 1 January 2013 did not attract tax deduction requirements applicable to commission or brokerage because those requirements depend on a principal-agent relationship. A bank issuing a guarantee gives an independent undertaking to the beneficiary for consideration and acts on a principal-to-principal basis, rather than as the payer's agent. The payment is therefore a banking-service fee, not commission or brokerage subject to tax deduction. A later exemption for specified payments to banks did not change this characterisation for the earlier period. Consequently, disallowance for non-deduction of tax from bank guarantee fees was unsustainable. Case-Laws Income Tax Thu, 23 Sep 2021 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=471675