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EQUILISATION LEVY / BM ACT |
Equilisation Levy
Problem (Equilisation Levy) (ID 01)
ABC Ltd. Indian company is carrying on the business of manufacture and sale of teakwood furniture under the brand name PUREWOOD In order to expand its overseas sales/exports. It launched a massive advertisement campaign of its products. For the purpose of online advertisement, it utilized the services of PQR Inc., A London based company During the previous year, ABC Ltd. paid 5 lakhs to PQR Inc. for such services. Discuss the tax implications of such payment and receipt in the hands of ABC Ltd. and PQR lnc, respectively, if
(I) PQR Inc. has no permanent establishment in India
(ii) PQR Inc. has a permanent establishment in india