No TDS on payments to NRI for Purchase of Raw Materials

Honda Cars India Ltd Vs DCIT (ITAT Delhi) The issue under consideration is whether the provisions of deduction of tax at source (TDS) would be applicable in case of payments made to non-resident Indian (NRI) for the purchase of raw materials? In the present case, TPO held that transaction of sale and purchase transaction of spare parts, raw material, capital goods, and export commission of the assessee with its AE (including Honda Motor, Japan) are at arm’s length and the assessee was required to deduct tax at source of payments made for the purchase of raw materials, components, etc. from n...