Obtaining Form 15CB on Import payment is Mandatory or Optional – Post Finance Bill, 2015

March 11,2015
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Vipul Jain (Consultant - Corporate Advisory & Taxation, Suresh Surana & Associates LLP )
Bhavin Sheth (Principal Consultant, Corporate Advisory & Taxation, Suresh Surana & Associates LLP )

Section 195(1) of the Income-tax Act, 1961 (“the Act”) requires deduction of tax at source from payment made by any person to a non-resident in respect of  any sum which is chargeable to tax under the provisions of the Act. Further, section 195(6) of the Act provides that "the person referred to in sub section (1) shall furnish the information relating to payment of any sum in such form and manner as may be prescribed by the board (i.e. 15CA and 15CB)".

In view of the above, a question arises whether Form 15CA / Form 15CB is required to be issued in respect of import payments, which are not chargeable to tax under the provisions of the Act.

CBDT vide Circular No. 23, dated 23 July 1969 stated that no liability will arise on accrual basis to the non-resident on the profits made by him where transactions of sales between two parties are on principal to principal basis. However, it may be noted that, Circular no. 23 has been withdrawn by CBDT vide Circular No. 7/2009 dated 22 October 2009.

The CBDT had issued Notification No. 67, dated 3 September 2013 thereby amending the Forms 15CA and 15CB. Accordingly, the Form 15CA is to be furnished in two parts as under:

  1. Part  A  of  Form  15CA  is  the  payment  does  not  exceed  Rs. 50,000  and  the aggregate amount during the year does not exceed Rs. 2,50,000.
  2. Part B of Form 15CA, along with Form 15CB or certificate of lower deduction u/s 197 or order under sub-section (2) or (3) of section 195, for any other payment.
  3. It also provided a list of 28 Specified items for which no details or Form 15CA or 15CB are to be furnished 

In the revised CBDT notification, the payment for import of goods has not been mentioned in 28 specified payments which does not require any details or Form 15CB.


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