Case Law Details
Case Name : Ashapura Minichem Ltd. (ITAT)
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All ITAT ITAT Mumbai
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In a recent ruling Mumbai Income Tax Appellate Tribunal in the case of Ashapura Minichem Ltd. (ITAT) [2010] 5 taxmann 57 (Mum.-ITAT)] on the issue of tax ability of payments made by the Taxpayer for services rendered outside India, under the provisions of the Indian Tax Laws (ITL) as well as the India- China Tax Treaty (Tax Treaty) held that such payments are taxable in India both under the ITL as well as the Tax Treaty and the Taxpayer is liable to withhold taxes (WHT) from such payments.
Facts
- The Taxpayer, a company resident of India, was in the process of building an alumina refinery using bauxite from the state of Gujarat. It engaged a Chinese company (China Co) for providing bauxite testing services in its laboratories and for preparing test reports which would be used by the Taxpayer to define the process parameters. China Co rendered the services from China and a consideration of USD 1m was agreed to be paid to China Co.
- The test reports of bauxite samples were to cover complete chemical composition of bauxite, physical phase constitution of bauxite, performance tests etc.
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Good decision by ITAT, Mumbai.