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2021 (7) TMI 1440 - AT - Income TaxIncome taxable in India - PE in India - Royalty receipts - Alleged Permanent Establishment (‘PE’) in India of the Appellant under Article 5(1) and 5(2)(T) of the India - UAE Tax Treaty (‘Tax Treaty’) - HELD THAT:- We find that identical issue raised in the present appeal has been adjudicated for Assessment Year 2013-14 [2021 (3) TMI 1440 - ITAT DELHI] we find that the assessee has met the twin criterion of existence of a fixed place of business and carrying out of business from such fixed place of business as enunciated of the judgment of Hon'ble Supreme Court in the case of Morgan Stanley & Co. [2007 (7) TMI 201 - SUPREME COURT] The claim of the assessee that they did not have a place at their disposal cannot be accepted in view of the judgment of Hon'ble Supreme Court in the case of Formula One World Championships Ltd. [2017 (4) TMI 1109 - SUPREME COURT] in the case of Azadi Bachao Andolan [2003 (10) TMI 5 - SUPREME COURT] and also E-funds IT Solutions [2017 (10) TMI 1011 - SUPREME COURT] The facts on record undisputedly prove that the premises AHL are at the disposal of the assessee for conduct of their business. While coming to the issue of "at the disposal" in the premises is available for the assessee for running of their business even for a limited time it constitutes a PE - Decided against the assessee. Attribution of profits to alleged PE of the Appellant in India inspite of entity level operating losses - alternative taxation of India source income as ‘Royalty’ under Section 9(l)(vi) of the Income Tax Act, 1961 (‘the Act’) and Article 12 of the Tax Treaty - We find that the identical issue raised in the present appeal, has already been adjudicated for Assessment Year 2013-14. [2021 (3) TMI 1440 - ITAT DELHI] to hold that the revenue's earned by the assessee are taxable under Article 12 of the DTAA. Regarding the determination of the profit, taken up at ground No. 4 by the assessee, we hereby hold that the taxable profits may be computed in accordance with the provisions of Section 44DA of Indian Income Tax Act and Article 12 of Indo-UAE, DTAA. During the arguments, it was also submitted that the assessee has incurred losses in the assessment year 2008-09. The assessee be given an opportunity of submitting the working of apportionment of revenue, losses etc. on financial year basis with respect to the work done in entirety by furnishing the global profits earned by the assesse, so that the profits attributable to the work done by the PE can be determined judiciously. The same may be considered while determining the taxable profits in India in accordance with the provisions of Section 90(2). Thus the issue of attribution of profit to the Permanent Established (PE) is accordingly restored to the file of Assessing officer for deciding in the light of the direction of the Tribunal in AY 2013-14, as reproduced above. Appeal of the assessee is allowed partly for statistical purposes.
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