The Mumbai Income Tax Appellate Tribunal recently issued a decision on whether payments for services rendered overseas are subject to withholding tax in India. The case involved an Indian accounting firm, BSR & Company (BSR). In the year concerned, BSR made payments for taxation and audit services to service providers in Ireland, Indonesia, the UK and the U.S., which amounted to approximately INR 7.8 million. Because the services were rendered overseas, BSR determined that it did not need to withhold any tax on the payments. However, in auditing the return, the assessing officer determined that the payments were fees for...