No Tax deduction required on reimbursement of expenses

 Section 195 of the Act clearly states that any person responsible for paying to a non resident any interest or any other sum chargeable under the provisions of this Act shall at the time of credit of such income will income tax thereon at the rate inforce at the time of payment or credit. Therefore, the first test to be applied for deduction of TDS is to see whether income in the hands of payee is taxable in India or not. In the present case, the payments were reimbursement of expenses and was in no way income chargeable to tax in India in the hands of the payee and hence did not require any...