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2010 (9) TMI 720 - AT - Income TaxDTAA between India and USA - Income escaping assessment - Addition - Competent authorities have considered the fact that it is a case of e-commerce, where business may be transacted on global basis through various tax jurisdiction and income may be earned in various jurisdiction even though theoretically a case can be argued that conditions mentioned in article 5 of the DTAA are not be fulfilled as they relate only to conventional business and not e-commerce - MAP resolution is to be viewed as an application of the DTAA to an e-commerce environment, where the literal application of article 5 may not lead to a correct representation of the taxing rights of the two tax jurisdiction - Appellants have not been able to point out any change in the business model as compared to these MAP assessment years it is clear that the Appellants have a PE in India in accordance with the above analysis and MAP resolution - It shall be pertinent here to indicate that the whole exercise is to ascertain the effect of assessees’ business connections in India in terms of profits, which are attributable This methodology/ formula will be more helpful in arriving at the reasonably correct amount of attributable income, being comparatively just, fair and equitable - law is very clear that Sec. 195(1) is applicable to a person who pays any amount by way of income to non-resident. In assessees’ case the revenue has been recognized in India by eFunds India International - how the balance income, which should have been recognized in India can become liable to TDS in India - the assessee is liable to interest u/s 234A & B, as the income being assessed now cannot be held to be income liable to TDS under Indian provisions Provisions of sections. 234A & B are mechanical in nature, as held by Hon’bleble Supreme Court in the case of Anjuman Ghaswala 252 ITR - In the result, assessees’ appeals are partly allowed for statistical purposes. Revenue’s appeals are allowed
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