|QUERY:||Whether the decision of GC India Technology Centre P. Ltd. vs CIT [327 ITR 456 (SC)] can be taken advantage under section 40(a)(ia) to say that tax was not chargeable and hence tax need not be deducted on the payment?|
|ANSWER:||Yes, the Supreme Court has confirmed that the obligation to deduct tax at source arises only if “sum is chargeable under the provisions of the Act” but it is not clear from the query how any interest, commission, brokerage, rent, royalty, fees for professional services or fees for technical services payable to a resident, or amount payable to a contractor or sub-contractor being resident for carrying out any work, is not chargeable under the Act? Therefore, liability to deduct tax under section 40(a)(ia) would remain, if the amount is credited or paid, whichever is earlier.|
|EXPERT:||CA. H. N. Motiwalla|
|CATCH WORDS:||disallowance, tax deducted at source|
Opinion Of Eminent Legal Luminaries On Controversial Issues
Whether Tax Is Required To Be Deducted On The Amount Which Is Not Chargeable To Tax?
Credit: Several of the queries and answers are reproduced with permission from the AIFTP Journal. We thank AIFTP for generously allowing us to host their research material.
Disclaimer: The contents of this document are solely for informational purpose. It does not constitute professional advice or a formal recommendation. While due care has been taken in preparing this document, the existence of mistakes and omissions herein is not ruled out. Neither the author nor itatonline.org and its affiliates accepts any liabilities for any loss or damage of any kind arising out of any inaccurate or incomplete information in this document nor for any actions taken in reliance thereon. No part of this document should be distributed or copied (except for personal, non-commercial use) without express written permission of itatonline.org