Whether the assessee is liable to deduct tax at source on reimbursement of expenses ?

An Indian company has engaged a foreign company to keep some employees selected by Indian Company to keep on its ( foreign company ) pay rolls . The foreign company shall take payment from Indian company towards salary and other out of pocket expenses of employee and pay to employees, it shall also take care of local labour laws compliances and shall get % of the the total payments as its fees. What shall be treatment of this payment in hands of Indian Company - whether it shall FTS or payment of business profits for determining if withholding tax to…

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