Indian Tribunal Holds Rental, Advertising, and Exhibition Fees Not Subject to Withholding Tax

The Delhi Income Tax Appellate Tribunal recently issued a decision concerning whether tax withheld on payments for advertising and exhibition services should be refunded. The case involved BrahMos Aerospace, an India-Russia Joint Venture based in India.

In the year concerned, BrahMos made payment to foreign entities for foreign office rental, foreign exhibitions, and advertising of its products in foreign journals. BrahMos withheld tax on the payments, but later determined that the payments …