TDS on post film production services outside India by foreign Company

1. The brief background of the issue is that during the F.Y. 2004-05, the assessee paid a sum of Rs.8,46,838/- to M/s VHQ Singapore without deducting tax on the same. The AO was of the opinion that this amount was in the nature of professional fee and, therefore, assessee was required to deduct tax at source on the applicable rates. The assessee submitted before the AO that the recipient company was located in Singapore and it did not have a Permanent Establishment (PE) in India. The said company had rendered post production services in Singapore for the purpose of an advertisement film and th...