IN THE CASE OF SAMSUNG ENGINEERING CO. LTD. FOLLOWING HAS BEEN DECIDED
- Interest on FD is Business Income
Interest income earned on Fixed Deposit made for the purpose of business should be
considered as business income and not as income from other sources.
- Salary and Welfare not covered under section 44C
The Tribunal held that salary and welfare expenses of taxpayer's staff will not be
covered under section 44C of the Income-tax Act, 1961 (the Act) since the expenses are directly related to the Indian Project.
- Payment for procurement services cannot be considered to be a payment towards fees for technical services
The Tribunal also held that the payment made for procurement services cannot be
considered to be a payment towards fees for technical services as per India-Korea Tax Treaty (the tax treaty) since procurement services were purely commercial in nature and had nothing to do with rendering of any technical managerial or consultancy services.