2018 (12) TMI 1904 - HC - Income Tax

PE in India - Whether Tribunal was justified in remanding the matter back to Assessing officer for fresh consideration when the Assessing Officer had not discharged the burden of proving that the appellant had a PE in India? - HELD THAT - It is agreed position between the parties that the appellant being aggrieved by the above order of the Tribunal 2015 (5) TMI 760 - ITAT MUMBAI had preferred appeal to this Court 2018 (9) TMI 231 - BOMBAY HIGH COURT . The above appeals were disposed of by this Court by setting aside the order of the Tribunal dated 1.4.2015 to the extent it had remanded the issue of permanent establishment to the assessing officer for fresh adjudication. It is an agreed position between the parties that the above decision dated 29.8.2018 of this Court in Income Tax Appeal No. 1198 of 2015 other appeals will equally apply to this appeal. Thus, the common impugned order dated 21.2.2017 of the Tribunal for A.Y. 2004-05, 2006-07, 2007-08, 2008-09, 2009-10 2010-11 is quashed and set aside. The appeals are restored to the Tribunal, for final disposal on the question Permanent Establishment in accordance with law.

Summary

Issues:
1. Challenge to the common order of the Income Tax Appellate Tribunal for multiple assessment years.
2. Existence of Permanent Establishment in India.
3. Justification of remanding the matter back to the Assessing Officer.
4. Application of previous court decisions on the issue of permanent establishment.

Analysis:
1. The appeals under Section 260A of the Income Tax Act, 1961 challenge the common order of the Income Tax Appellate Tribunal for the assessment years 2004-05, 2006-07, 2007-08, 2008-09, 2009-10, and 2010-11. The primary contention raised by the appellant-assessee revolves around the question of whether they have a Permanent Establishment (PE) in India.

2. The appellant-assessee raised two common questions of law regarding the existence of a Permanent Establishment in India and the justification for remanding the matter back to the Assessing Officer for fresh consideration. The Tribunal's impugned order remanded the issue of permanent establishment to the assessing officer based on a previous order of its coordinate bench. However, the appellant contested this decision, arguing that the burden of proving the existence of a PE was not discharged by the Assessing Officer.

3. The High Court noted that the issue of permanent establishment had been previously addressed in appeals to the court, resulting in the setting aside of the Tribunal's order that remanded the matter to the Assessing Officer for fresh adjudication. The court's decision dated 29.8.2018 in Income Tax Appeal No. 1198 of 2015 and other appeals was deemed applicable to the present case, leading to the quashing and setting aside of the Tribunal's order for the assessment years in question.

4. Consequently, the High Court quashed and set aside the common impugned order of the Tribunal for the relevant assessment years and restored the appeals to the Tribunal for final disposal on the question of Permanent Establishment in accordance with the law. All six appeals were disposed of accordingly, and the Notices of Motions taken out in all the appeals were deemed infructuous in light of the court's decision.