9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2025 (2) TMI 455 - HC - Income TaxExistence of dependent PE in India/fixed place PE in India - HELD THAT - Substantial questions of law raised in this appeal are no more res integra and has been decided against the appellant/revenue by the judgements passed in Adobe Systems Software Ireland Ltd. 2025 (1) TMI 1412 - DELHI HIGH COURT - The parties in the aforesaid batch matters and the present appeals are the same except that in those appeals the AYs were for the years from 2013 till 2017 whereas in the present appeal the AY pertains to 2020-2021. No substantial question of law is made out in the present appeal.
ISSUES PRESENTED and CONSIDERED:1. Whether the Income Tax Appellate Tribunal (ITAT) erred in its decision regarding the existence of a dependent Permanent Establishment (PE) or fixed place PE in India for the assessee company.2. Whether the ITAT erred in applying the judgment in DIT v. Morgan Stanley Co [2007] 292 ITR 416 (SC) to the case of the assessee company.3. Whether the ITAT erred in deleting the addition made on account of profit attribution to the PE in India due to lack of information.4. Whether the ITAT failed to follow the directions of the Supreme Court in the case of DIT v. Morgan Stanley Co regarding the determination of arm's length remuneration for risk-taking functions.5. Whether the ITAT failed to provide a detailed analysis on whether Adobe India constitutes a PE of Adobe Ireland.6. Whether the ITAT erred in not appreciating the Double Irish Model of corporate structuring aimed at tax avoidance.ISSUE-WISE DETAILED ANALYSIS:Relevant legal framework and precedents:The appeal was filed under Section 260A of the Income Tax Act, 1961, challenging the ITAT's order for the Assessment Year 2020-21. The appellant raised substantial questions of law regarding the ITAT's findings on the existence of a PE in India and profit attribution issues. The appellant cited the judgment in DIT v. Morgan Stanley Co [2007] 292 ITR 416 (SC) as relevant to the case.Court's interpretation and reasoning:The senior standing counsel for the revenue pointed out that similar issues had been decided against the appellant in previous judgments by a Co-ordinate Bench of the Court in Commissioner of Income Tax - International Taxation-1 vs. Adobe Systems Software Ireland Ltd.; 2025 SCC OnLine Del 411. He conceded that no substantial question of law was evident in the present appeal based on the previous decisions.Key evidence and findings:The Court considered the arguments presented by the appellant regarding the ITAT's decisions on the existence of a PE in India, profit attribution, and the application of the Morgan Stanley judgment. The Court noted that the issues raised in the present appeal had been previously addressed in similar cases involving the same parties.Application of law to facts:The Court applied the legal principles established in previous judgments to the present case, finding that the appellant had failed to demonstrate any new legal grounds warranting a different outcome. The Court concluded that the appeal lacked merit based on the precedents and the absence of substantial legal questions.Treatment of competing arguments:The senior standing counsel for the revenue acknowledged the previous decisions against the appellant and conceded that the appeal did not raise any new legal issues. The Court did not find any compelling arguments from the appellant to overturn the ITAT's findings.SIGNIFICANT HOLDINGS:The Court held that the present appeal lacked merit and disposed of it along with pending applications based on the previous decisions by a Co-ordinate Bench. The Court found no substantial questions of law that warranted a different outcome from the ITAT's decision.Core principles established:The Court reiterated the importance of consistency in legal decisions and the application of established legal principles to similar cases involving the same parties. The Court emphasized the need for parties to present new and compelling legal arguments to challenge previous judgments.Final determinations on each issue:The Court determined that the appellant's appeal was unmerited and lacked substantial legal grounds for challenging the ITAT's decision. The Court disposed of the appeal based on the previous decisions and the absence of new legal arguments presented by the appellant.
|
