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2016 (12) TMI 1291 - AT - Income TaxIncome from "distribution activities" - Income taxability in India - assessable profits arising from Indian operation to be attributable for the functions performed by the "independent agent PE" in India - Held that:- If admittedly Taj India is being remunerated at arm‟s length, then, no further income/profit can be said to be attributable to the assessee in India from PE. It is an undisputed fact that the TPO has accepted the transaction between the assessee and Taj India at an arm‟s length price. Hence, we also hold that if the arm‟s length price of the transaction has been accepted, between the assessee and Taj India, then nothing further should be attributable to the assessee which is to be taxed in India. Thus, on this reasoning we allow the assessee‟s ground No.1. We are making it clear that, so far as the issue of PE qua the advertisement revenue is concerned, same is kept open. See DIT Vs Morgan Stanley & Co. reported in [2007 (7) TMI 201 - SUPREME Court ] Allowance u/s 40 (a) (i) - Held that:- We hold that no disallowance u/s 40 (a) (i) can be made on account of “programming cost” paid to various non-residents and also payments made to PanAmSat and other non-residents.
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