Fees paid to a foreign company for rendering testing and certification services cannot be treated as income deemed to accrue or arise in India under Section 9(1)(vii) of the Income-tax Act

Havells India Ltd. Vs ACIT (ITAT Delhi) (Decided on 27th May 2011)  It has been held that where services have been rendered outside India and have been utilised for the purpose of making or earning any income from any source outside India, such payments would fall outside the purview of Section 9(1)(vii) of the Act and will not be deemed to accrue or arise in India. The Tribunal observed that the testing and certification was necessary for the export of the product and was utilised for such export. The said services were rendered and utilised outside India. Therefore, the income fell outsid...