Principal to principal
COLIN FERNANDES
(Querist) 27 August 2015
This query is : Resolved
How can you distinguish if an agreement is Principal to Principal for Principal to Agent for tax purposes in India
Anirudh
(Expert) 27 August 2015
Pl. give your fact situation, so that one can answer.
COLIN FERNANDES
(Querist) 27 August 2015
An International courier company appoints an Indian courier company as its agent for carrying out certian activities in india which will include pickup, delivery of shipments and bringing it to the airport and also local pomotion of the business. The Indian company appoints the International company as its agent for international transport, pickup and delivery of its shipments. How will this agreement be treated since each companies are appointing each other as its agent
Anirudh
(Expert) 27 August 2015
When you yourself are saying that one is a 'Agent' - then where is the question of principal to Principal arises?
Are you responsible or not for whatever the International Courier Company does on your behalf?
Similarly, whether or not the international courier company is responsible for whatever that you do on its behalf?
COLIN FERNANDES
(Querist) 27 August 2015
The international courier company will bear the risk once the shipment is at the airport (loaded into the aircraft) and vice-versa.
The Indian company will bear the risk when the shipment is its position to carry out its activities as per the agreement
Anirudh
(Expert) 27 August 2015
The person who booked the article/parcel will ask/sue for damages you or the International Courier?
Similarly, the person who booked the article/parcel through the International Courier will ask/sue for damages the International Courier or you?
If you say that you are responsible to your customer, for the Articles/parcel booked by you and you will pay the compensation; and then you will recover whatever compensation paid by you from the International Courier firm, then you and international courier are acting on principal to principal basis and not on principal/agent basis.
COLIN FERNANDES
(Querist) 27 August 2015
Hi Anirudh thanks for your reply. I will be responsible for my customer and can recover the damages from the international courier company. Similarly the International company customers will sue it for any damages.
Rajendra K Goyal
(Expert) 27 August 2015
The liability depends on the terms of agreement between the two companies.
COLIN FERNANDES
(Querist) 27 August 2015
Hi Rajendra.. my query was how will the agreement be treated in india for tax purposes. If it is treated as principal to agent i fear that the International company will be subject to Income tax in India
M/s. Y-not legal services
(Expert) 28 August 2015
mr.colin fernandes, kindly see your posts.. you said as "hi rajendra"..
it is seems very indecent. just try to behave decent on a public forum.,
is mr.rajendra goyal your friend? or classmate? that who can call him like what you said..
he is a valuable member and expert in this site.
i am not intent to hurt you or tease you mr.fernandes..
