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Tax Publishers
Minimum guarantee payments - whether subject to
TDS
Facts:
Assessee had to pay minimum guarantee fees to certain
hotels/stays as they could not comply with the promised minimum
volumes/revenues. No TDS was made on these payments. Revenue disallowed the
spend for non-deduction of TDS under section 40a(ia). On appeal CIT(A) held
that TDS was applicable under section 194-C and not under 194-I and sustained
the disallowance. On higher appeal by the assessee -
Held in favour of the assessee that no TDS was obligated on
the minimum guarantee payments. Disallowance was unwarranted.
Case: Oravel Stays
(P) Ltd. v. ACIT 2024 TaxPub(DT) 803 (Del-Trib)
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