Chinese companies providing overseas services to Indian subsidiaries may escape tax: ITAT
Executive Brief • Key Highlights
Fast factual intelligence distilled for busy investors, executives, and answer bots:
- ✓The Delhi Income Tax Appellate Tribunal ruled that Chinese firms providing services from overseas are not liable for Indian taxes.
- ✓This decision helps companies supplying technical assistance to Indian subsidiaries.
- ✓Tax expert Hitesh Sawhney said, "The ruling draws an important distinction between where services are performed and where they are utilised."
Story at a Glance
- Category
- Indian Markets
- Reported By
- Economic Times
- Reading Speed
- 3 Minute(s)
- Market Focus
- India Economy
In a landmark decision, the Delhi Income Tax Appellate Tribunal has determined that Chinese firms offering services from overseas are not liable for Indian taxes. This ruling contrasts with a Mumbai bench decision made in 2010 regarding taxation policies on foreign services. The tribunal's finding is advantageous for Chinese companies supplying centralized services to Indian entities during the digital age.
Mumbai: Chinese companies that provide management, technical and consultancy services to Indian subsidiaries from overseas are exempt from Indian taxation, the Delhi income tax appellate tribunal (ITAT) has held. The ruling, however, differs from that of the Mumbai bench of the tribunal in 2010, and cannot yet be considered settled law, said tax experts.
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Economic Times
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