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2009 (8) TMI 6 - AAR - Income TaxPayment made by IIPL – The applicant incurs expenditure in relation to the functions enumerated in Schedule I to the said Agreement for the benefit of the Group as a whole. Pursuant to the Agreement the applicant raises invoice on IIPL for the amounts worked out on the basis of the formula in the Agreement. It is stated that none of the personnel of the applicant visited nor would in the future visit India for providing the centralized assistance to IIPL - Question whether payment made by IIPL towards the costs allocated by the Applicant is taxable in India – Whether IIPL is liable to deduct TDS (withhold tax) - Assuming that some of the activities are not really services but they are more in the nature of stewardship/shareholder activities, for that reason, the amounts received by the applicant from IIPL in terms of the invoices raised by it cannot be taxed in India in the absence of permanent establishment of the applicant – Amount is not taxable in India – TDS (withholding tax) is liable to be deducted.
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