Taxation on Grants/Services provided by foreign enterprises

Dear Sir,‎

I am by profession a Consultant , promote business venture in India. Enterprises from Italy has ‎business in India. Their question is as follows: ‎

A enterprise from abroad intend to have clarification:‎

Their Indian customers placed in Nashik near Mumbai has to pay to our (Italian ‎enterprise) associated company an installation service for a press machine in India. He ‎would reduce his payment for 15% for “tax service”.‎

They intend to know if this tax is due and if it has to be paid by the indian customer or by ‎the italian company. If the tax is due by the italian company it is possible to request the ‎remboursement of the tax?‎

and how the italian company can obtain it?‎

I request you to respond to this mail, with clarification. ‎

Dr.Pramod Kumar Verma
Resource Person to SEBI
& Director EDT. Saket

Economic Development Trust ‎

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One Response to Taxation on Grants/Services provided by foreign enterprises

  1. S Ramesh says:

    Dear sir

    It is not clear from the query as to what tax is being referred to. Is it WHT under income tax act or service tax?

    This is a question that can be answered after going through the documents and considering whether the Italian company has a PE (Permanent Establishment) in India

    This in my opinion requires professional advice and may not be possible to answer in a forum


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