Tribunal held that; transformers manufactured by assessee were sent to Netherlands for testing and Netherlands Company sent only report. Therefore, knowledge of testing was not made available to assessee. Hence, it could not be considered as fee for technical services. In view thereof payment made to Kema, Netherlands was not liable to deduct tax at source. (AY .2007 – 2008)
ACIT v, Areva T&D India Ltd. (2018) 193 TTJ 11 (UO) (Chennai) (Trib)
S. 40(a)(i) : Amounts not deductible-Deduction at source-Testing fee to Kema, Netherlands-Payment made to non-resident-Where knowledge of testing is not made available to assessee, same could not be considered as fee for technical services and assessee is not liable to deduct tax at source. [S. 195 ]