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2018 (11) TMI 1107 - ITAT MUMBAIFTS - P.E. in India - “make available” any technical knowledge - payment of fees for the service as made directly by the subscribers to the assessee in foreign exchange - India-U.K tax treaty dealing with taxability of business profit - Held that:- We are of the considered view that the Reuters Dealing 2000-2 is an electronic deal matching system, enabling authorized dealers in foreign exchange such as banks etc. to affect deals in spot foreign exchange with other foreign exchange dealers. The system only provides a platform for the forex dealers to affect deals with other subscribers by entering orders into the system, which may be matched directly by the system with orders entered by other subscribers. We find that the assessee which operates its business through its branch in Geneva where its main server is located does not “make available” any technical knowledge etc. to its customers by rendering the services. We thus, are in agreement with the observations of the CIT(A) that as the rendering of the services by the assessee does not “make available” any technical knowledge etc. to the customers, hence the fees received from providing of such services would not fall within the sweep of the definition of FTS as per Article 13 of the India-U.K tax treaty. The Ground of appeal No. 1 of the revenue is dismissed in terms of our aforesaid observations. P.E in India - Held that:- For constituting a fixed place P.E, either the place should be owned or at the disposal of the assessee. However, in the case before us, as observed by the CIT(A), the assessee was carrying on its business from Geneva and the communication network in India was neither owned by it or at its disposal, but rather was owned by the independent service providers such as VSNL, DoT etc. Further, no personnel of the assessee had visited India during the year under consideration. CIT(A) had rightly concluded that as the assessee did not have a P.E in India during the year under consideration, hence, the fees received from rendering of the services which were not in the nature of FTS, in the absence of a P.E of the assessee in India would not be taxable in India. - Decided against revenue.
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