TMI Blog2023 (6) TMI 1321X X X X Extracts X X X X X X X X Extracts X X X X ..... . As decided in BLACKSTONE CAPITAL PARTNERS (SINGAPORE) VI FDI THREE PTE. LTD. [ 2023 (2) TMI 35 - DELHI HIGH COURT] Assessing Officer cannot merely do a cut and paste job for reopening the assessment without independent application of mind or verification or investigation. This decided squarely applies to the facts of the present appeal, as the departmental authorities have merely followed the decision taken by them and higher appellate authorities in assessee s cases in past assessment years without independent application of mind to the facts brought on record by the assessee or making proper verification/investigation of the evidences. The evidences brought on record by the assessee remain uncontroverted. When the evidences brought on record by the assessee are before the departmental authorities, it is the duty of the departmental authorities to examine them on merits and thereafter, either to accept them or to reject them with proper reasoning by bringing on record contrary material/evidence. In the facts of the present appeal, the departmental authorities have failed to undertake such exercise. Therefore, in our view, it has to be concluded that the departmental authorities ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n that GE group is engaged in various sales activities in India, for which the business heads are generally expatriates, who are appointed to head Indian operations with the support staff provided by GE India Industrial Pvt. Ltd. and other third parties. It was found that expatriates are on the payroll of GE International Inc (GEII), but working for various business of GE group. Further, the Assessing Officer found that as per application made to Reserve Bank of India (RBI) and permission obtained, the liaison office was to act as a communication channel between the head office and the customers in India. 4. From the material available, it was found that GEIOC was carrying out business in India through a PE. Whereas, the income attributable to such PE was taxable in India, but was not offered in the Income-tax return. He observed that based on the materials found in course of survey operation, assessments were completed for the assessment years 2002-03 to 2006-07 holding that the assessee has a fixed place PE at their disposal in the form of office at premises of AIFACS, 1, Rafi Marg, New Delhi, wherefrom the activities of the assessee and other group entities were being conducted. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year, as the AIFACS building, which was held to constitute fixed place PE of the assessee in India, was vacated by GEIOC on 01.05.2012. Further, he submitted, while deciding the issue of existence of fixed place PE in the past assessment years, the authorities have taken note of the fact that the activities relating to solicitation of orders and conclusion of contract were carried by the expatriates and employees of GEIIPL from AIFACS building. Thus, based on this singular factor in past assessment years, it was held that the assessee had PE in India. However, the facts have completely changed in the impugned assessment year, as the office premises at AIFACS building has been vacated and also no expatriate has visited India during the year. 7. Thus, he submitted that instead of plainly following the past assessment history, the departmental authorities should have decided the issue of existence of PE in India by keeping themselves confined to specific facts of the impugned assessment year. He submitted, whether a non-resident entity has a PE in another country has to be determined on a year to year basis looking at the facts involved in the particular year. He submitted, merely be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a vs. ITO, 251 ITR 541 (Guj); (v). Mahindra Mahindra Ltd., 122 TTJ 577(SB)(Mum). 9. Strongly relying upon the observations of the Assessing Officer and learned DRP, learned Departmental Representative submitted, the issue relating to existence of fixed place PE has been concluded in favour of the Revenue. Hence, the addition made by the Assessing Officer should be upheld. 10. We have considered rival submissions and perused materials on record. We have also applied our mind to the judicial precedents cited before us. The short issue arising for consideration is whether the assessee had a PE, either fixed place PE or dependent agent PE, in India during the year under consideration. No doubt, the past assessment history of the assessee reveals that existence of PE in India was upheld by the Tribunal and Hon ble jurisdictional High Court in assessment years 2002-03 to 2006-07 and 2008-09. Perusal of facts on record including the discussion made by the Assessing Officer and learned DRP would reveal that the reason why the existence of PE was upheld in earlier assessment years are as under : (i). The assessee has an office premises at AIFACS building; (ii). Expatriates along with employ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee brought on record all material and evidences to establish that it does not have any PE in India. As it appears from the respective orders of the departmental authorities, without dealing with the submissions of the assessee and evidences brought on record through proper reasoning or by bringing any contrary material to controvert them, the departmental authorities have merely followed their earlier decision without making any effort to look into the specific facts of the impugned assessment year. As discussed earlier, the assessee has brought on record cogent evidence to demonstrate that there is substantial change in facts in impugned assessment year qua the existence of PE. The specific averment of the assessee regarding vacation of office premises at AIFACS building and no visit by expatriates in India during the year, have not been controverted by the departmental authorities by any specific factual finding. In case of Blackstone Capital Partners (Singapore) VI FDI Three Pte. Ltd. (supra), Hon ble jurisdictional High Court, while dealing with the issue of reopening of assessment based on information received from third party, observed, though such information can form basi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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