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  • Service: Tax, International Corporate Tax, International Executive Services, Global Compliance Management Services
  • Type: Regulatory update
  • Date: 2/26/2013

India - Ink-jet solution under UK treaty; “freebies” for doctors 

February 26: The KPMG member firm in India has prepared reports on the following developments (read the February 2013 reports by clicking on the hyperlinks provided below):

  • Payments for ink-jet printing solution are “fees for technical services” under India-UK income tax treaty: The Mumbai Bench of the Income-tax Appellate Tribunal held that payments made for procuring ink-jet printing solution are “fees for technical services” under the India-UK income tax treaty because: (1) the taxpayer had purchased certain technology and the right over the intellectual property; (2) the agreement not only covered the purchase of machinery but also the technical know- how; and (3) technology was made available to the taxpayer exclusively.

    The case is: Bajaj Holdings & Investments Ltd. Read a February 2013 report [PDF 205 KB]


  • Remuneration paid to consultant doctors by hospital classified as salary based on actual contractual relationship: The Hyderabad Bench of the Income-tax Appellate Tribunal held that tax was to have been withheld (deducted at source) on fees paid by hospital to the consultant doctors by treating these payments as salary, and not as “professional fees.”

    The case is: Wockhardt Hospitals Ltd. Read a February 2013 report [PDF 207 KB]


  • Expenditure disallowed for “freebies” provided by pharmaceutical entities to medical practitioners is valid: The Himachal Pradesh High Court held that guidance issued by the Central Board of Direct Taxes to disallow expenditures claimed for “freebies” provided to medical practitioners is valid.

    The case is: Confederation of Indian Pharmaceuticals Industry. Read a February 2013 report [PDF 192 KB]



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