9911796707
TMI BlogTax on dividends, royalty and technical service fees in the case of foreign companiesX X X X Extracts X X X X X X X X Extracts X X X X ..... n foreign currency, of a Mutual Fund specified under clause ( 23D ) of section 10 or of the Unit Trust of India, the income-tax payable shall be aggregate of- ( A ) the amount of income-tax calculated on the amount of income by way of dividends 36 [other than dividends referred to in section 115-O ], if any, included in the total income, at the rate of twenty per cent ; 40 [ Provided that the amount of income-tax calculated on the amount of income by way of dividend received from a Unit in an International Financial Services Centre, as referred to in sub-section (1A) of section 80LA, shall be ten per cent.; ] ( B ) the amount of income-tax calculated on the amount of income by way of interest referred to in sub-clause ( ii ), if any, included in the total income, at the rate of twenty per cent ; 37 [ (BA) the amount of income-tax calculated on the amount of income by way of interest referred to in,- (i) sub-clause (iia), if any, included in the total income, at the rate of five per cent.; (ii) sub-clause (iiaa) or sub-clause (iiab) or sub-clause (iiac), if any, included in the total income, at the rate provided in the respective sections referred to in ..... 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India established under the Unit Trust of India Act, 1963 (52 of 1963) .] 10 [ (1A) Where the royalty referred to in clause ( b ) of sub-section (1) is in consideration for the transfer of all or any rights (including the granting of a licence) in respect of copyright in any book to an Indian concern 11 [ or in respect of any computer software to a person resident in India ], the provisions of sub-section (1) shall apply in relation to such royalty as if the words 12 [ 13 [ the agreement is approved by the Central Government or where it relates to a matter ] included in the industrial policy, for the time being in force, of the Government of India, the agreement is in accordance with that policy ] occurring in the said clause had been omitted : Provided that such book is on a subject, the books on which are permitted, according to the Import Trade Control Policy of the Government of India for the period commencing from the 1st day of April, 1977, and ending with the 31st day of March, 1978, to be imported into India under an Open General Licence : 14 [Provided further that such computer software is permitted according to the Import Trade Control Policy of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of income referred to in 38 [ clause (a) or clause (b) ] of sub-section (1); and 39 [ (b) the tax deductible at source under the provisions of Part B of Chapter XVII has been deducted from such income and the rate of such deduction is not less than the rate specified under clause (a) or, as the case may be, clause (b) of sub-section (1). ]] ------------------------ Notes :- 1. Inserted by the Finance Act, 1976, w.e.f. 1-6-1976. 2. Substituted by the Finance Act, 1994, w.e.f. 1-4-1995. Prior to substitution, sub-section (1) was amended by the Finance (No. 2) Act, 1977, w.e.f. 1-4-1977/1-4-1978, the Finance Act, 1983, w.e.f. 1-6-1983, the Finance Act, 1986, w.e.f. 1-4-1987, the Direct Tax Laws (Amendment) Act, 1989, w.e.f. 1-4-1989 and the Finance Act, 1992, w.e.f. 1-6-1992. 3. Inserted by the Finance Act, 2003, w.e.f. 1-4-2004. Earlier the words other than dividends referred to in section 115-O were inserted by the Finance Act, 1997, w.e.f. 1-4-1998 and later on omitted by the Finance Act, 2002, w.e.f. 1-4-2003. 4. Substituted for a foreign company, includes any income by way of royalty or fees for technical services by the F ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 [ ( A ) the amount of income-tax calculated on the income by way of royalty, if any, included in the total income, at the rate of thirty per cent if such royalty is received in pursuance of an agreement made on or before the 31st day of May, 1997 and twenty per cent where such royalty is received in pursuance of an agreement made after the 31st day of May, 1997 6 [ but before the 1st day of June, 2005 ]; 7 [ ( AA ) the amount of income-tax calculated on the income by way of royalty, if any, included in the total income, at the rate of ten per cent if such royalty is received in pursuance of an agreement made on or after the 1st day of June, 2005; ] ( B ) the amount of income-tax calculated on the income by way of fees for technical services, if any, included in the total income, at the rate of thirty per cent if such fees for technical services are received in pursuance of an agreement made on or before the 31st day of May, 1997 and twenty per cent where such fees for technical services are received in pursuance of an agreement made after the 31st day of May, 1997 8 [ but before the 1st day of June, 2005 ] ; and ] ..... 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