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2024 (2) TMI 987 - ITAT DELHIAccrual of income in India - existence of DAPE - PE in India or not? - AO's conclusion of the assessee having a PE in India and consequently attributing 25% of receipts on account of Software License Fees from Indian clients as taxable in India as business income - As argued there being no dependent agent PE in India still the Ld. AO in final assessment order has held about existence of the DAPE. HELD THAT:- On considering the findings of Ld. DRP we are of the considered view that Ld. DRP seems to have fallen in factual error in mentioning the plea of the assessee that the issue of DAPE of the assessee in India has been considered by the Tribunal in AY 2018-19 and 2019-20. While that is not correct as with regard to the fixed place PE of the assessee the issue certainly stands settled in favour of the assessee. DRP has erred in not dealing with the issue of assessee company having a DAPE in India on merits and erroneously directed AO for verifying if the issue of DAPE was decided in favour of assessee by the Tribunal in AY 2018-19 and 2019-20, which admittedly is not covered in earlier years. Thus, we are inclined to set aside the order of the Ld. DRP with regard to examination of the question of existence of DAPE in the relevant assessment year. Resultantly the impugned final assessment order is set aside. The Ld. DRP, after giving an opportunity of hearing to the assessee, shall pass fresh order in regard to the issue of existence of DAPE and consequential directions be accordingly issued to the AO.
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