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2009 (9) TMI 26 - AUTHORITY FOR ADVANCE RULINGPE / Business Profit – DTAA – Held that - The more crucial question that needs to be considered now is whether the work place set up by the sub contractor to carry out the works entrusted to him by the applicant can be treated as the work place and the permanent establishment of the applicant. - it cannot be concluded that the business of the applicant is being carried on through the sub contractor’s workshop - the concept of PE conveys the idea that the enterprise’s presence has to be “visible” through an establishment in the other country - at the present juncture it is not possible to hold that the applicant has or will have a PE in India. Hence, its business profits arising from the periodical payments made by TPT as a consideration for the contract cannot be subjected to tax under the Income-tax Act, 1961 in view of Article 7.1 of DTAA between India and Germany.
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