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2022 (6) TMI 180 - AT - Income TaxIncome accrued in India - existence of PE in India under Article 5 of Indo-Switzerland DTAA - racing drivers' stay in India - DTAA between India and Switzerland - whether the racing car driver in the case before us is a driver simplicitor or is he a technical expert ? - HELD THAT:- Ld. counsel could not give a cogent reply nor he could rebut the proposition that the racing car driver is not a technically expert person. Moreover the reference by DRP to OECD commentary in the context of model tax treaty that formula one driver is in the nature of athlete is also germane and has to be considered. As our following discussion would show certain other aspect of the present case need some factual examination. In this view of the matter, in our considered opinion, in the present case, the issue cannot be remitted to the AO to follow the said ruling as requested by assessee. Now coming to the order of the AO passed pursuant to the DRP order, we note that there are two limbs thereof. In the first limb, the DRP has accepted that assessee has no PE existence and the DRP has accepted that the racing car driver came and performed for only three days in India. In this connection, a query was raised as to the actual duration of the said drivers' stay in India in connection with the aforesaid race, the time taken for preparation, finalization & conclusion and the certificate of the said drivers' arrival in India and departure in relation to the event. Assessee was not in a position to provide any such detail. As submitted that these aspects are factual aspects and are not readily available and the matter can be remitted to the AO for examination in this regard. We find that the aforesaid is a crucial aspect and has not been examined by the Revenue authorities below, hence we deem it proper to remit the file to the AO to examine the issue in terms of our observation as above. As regards the plank on which the DRP had rejected the assessee's objection is by reference to Article 17 of the model tax treaty that the receipts are in the nature of income derived from service of personal activities of racing car drivers in India. We note that the aforesaid reference in the present case is coming under Article 16 of the DTAA between India and Switzerland which deals with the issue of artists and athletes dealt with by the DRP. We note that this aspect of DRP's direction refers that there was no response from the assessee. But the assessee in grounds has disputed the observation that it has not given any response in this regard. We deem it proper to remit this aspect also to the AO and the assessee shall be granted an opportunity to give the submissions in this regard.
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