Furnishing of information in respect of payment to non-resident in Form 15CA/15CB
W.e.f 1st June 2015, Form 15CA/15CB has been made mandatory to all payments (including imports) irrespective of whether that income is taxable in India or not. Further, penalty u/s 271-I has also been introducedin respect of non-furnishing of information or furnishing of inaccurate information in Form 15CA/15CB of Rs. 1,00,000/-. Now, sub-Section (6) is amended to provide for furnishing of information whether or not such remittances are chargeable to tax. This would cast a heavy burden on persons who make payments to non residents–especially in case of import of goods. Even for such payments, now, the obligation to furnish Form 15CA (and also Form 15CB) will have to be complied with.
In case of import of goods the amount to be remitted is the sale proceeds which include component of income and it would be in the nature of business income. In absence of any business connection or permanent establishment (‘PE’) in India the said component of income would not be considered to accrue or arise in India and would not liable for TDS in India even under the DTAA .
Legally there is relevance in obtaining Form 15CB with regard to import payment mainly to determine,whether the foreign supplier of goods has PE or Branch or Liaison Office or Subsidiary in India who is providing the important services or effectively involve with foreign supplier for importing of goods for which the payment for import of goods can be attributed and taxed in India.
Further, the intent of CBDT for withdrawal the earlier Circular No. 23 and not mentioning the import payment in exclusion list would be that, CBDT also want the tax department to monitor the remittance made to non-resident and verify whether non-resident supplier has any PE or business connection in India where no tax has been deducted.