Law:

Section:

Section 195, read with section 5, of the Income-tax Act, 1961 - Deduction of tax at source - Payment to non-resident - Assessment years 1991-92 to 1994-95 - Assessee-company was engaged in sale and export of sea food and for that purpose it obtained permit to fish in exclusive economic zone of India - To exploit fishing rights, it entered into an agreement, chartering two fishing vessels with a non-resident company - Charter fee was payable from earnings from sale of fish and for that purpose 85 per cent of gross earnings from sale of fish was to be paid to non-resident company - Actual fishing operations were done outside territorial waters of India but within exclusive economic zone - Thereafter, chartered vessels with entire catch were brought to Indian Port, catch were certified for human consumption, valued, and after customs and port clearances, non-resident company received 85 per cent of catch - Whether, on facts, non-resident company effectively received charter fee in India and same would be chargeable to tax under section 5(2) - Held, yes - Whether, therefore, assessee was liable to deduct tax under section 195 on payment made to non-resident company - Held, yes FACTS The assessee-company was engaged in the sale and export of sea food and for that purpose it had obtained permit to fish in the exclusive economic zone of India. To exploit the fishing rights, it entered into an agreement chartering two fishing vessels with a non-resident company. The charter fee was payable from earnings from the sale of fish and for that purpose, 85 per cent of the gross earnings from the sale of fish was to be paid to the non-resident company. Trawlers were delivered to the assessee with full equipment and complement of staff at the Chennai Port. Actual fishing operations were done outside the territorial waters of India but within the exclusive economic zone. The voyage commenced and concluded at the Chennai Port. The catch made at high seas were brought to Chennai where a surveyor of the Fishery Department verified the log books and assessed the value of the catch over which local taxes were levied and paid. The assessee, after paying the dues, arranged customs…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492