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TMI Blog2017 (10) TMI 1254X X X X Extracts X X X X X X X X Extracts X X X X ..... the DTAA which specifically excludes the reinsurance business from constituting a PE in India. Accordingly, SRSIPL does not constitute a PE of the assessee in India under Article 5(5) of the DTAA and no question of attributing any profits to the PE arises. - Decided in favour of the assessee. - ITA No.2759/Mum/2017 And SA No.266/Mum/2017 - - - Dated:- 4-7-2017 - Shri Shamim Yahya, AM And Shri Ravish Sood, JM For The Appellant : Shri P.J.Pardiwala, Nishant Thakkar Ms.Jasmin Amalsadvala For The Respondent : Shri Jasbir Chauhanb (CIT-DR) ORDER Per Shamim Yahya, AM This appeal by the Assessee is directed against order of the Assessing Officer dated 04.11.2016 and corrigendum dated 10.03.2017 passed u/s 143(3) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... zerland Double Taxation Avoidance Agreement (IS tax treaty) and consequently, the reinsurance premium earned by the Appellant from Indian Insurance companies (hereinafter referred to as 'cedents') is taxable in India even though the risks are insured from outside India. With regard to the above, the learned AO erred on the following grounds: 2.1 The learned AO has, on the facts and circumstances of the case and in law, and based on the directions of the Hon'ble DRP, erred in concluding that the Appellant has a business connection in India as per the provisions of section 9(1 )(i) of the Act. 2.2 The learned AO has, on the facts and circumstances of the case and in law, and based on the directions of the Hon' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e learned AO has, on the facts and in the circumstances of the case and in law, and based on the directions of the Hon'ble DRP, erred in holding that SRSIPL could also constitute a Subsidiary PE of the Appellant in India as it carries out all the acts of the parent company in India. 2.5 The learned AO has, on the facts and in the circumstances of the case and in law, and based on the directions of the Hon'ble DRP, erred in estimating 10 per cent of the gross receipts attributable to the Indian operations to be the profit generally made by a re-insurance company in India and in estimating 50 per cent of the profit determined above to be attributable to the Appellant in India. 2.6 The learned AO has, on the facts and in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... considering that a refund of ₹ 39,219,764 has been granted to the Appellant where in fact, no such refund has been received by the Appellant. 7. Ground 7 The learned AO has, on the facts and circumstances of the case, erred in levying interest under section 234B of the Act amounting to ₹ 52,882,080 instead of ₹ 50,677,249, resulting in an excess levy of interest amounting to ₹ 2,204,831. 8. Ground 8 The learned AO has, on the facts and circumstances of the case, erred in considering that interest under section 244A of the Act amounting to ₹ 8,628,356 has been paid to the Appellant where in fact, no refund has been received by the Appellant for the year under consideration and thus, no c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s objection is therefore disposed off. 28.2 The AO is directed from the original records to see if any appeal has been filed before the Hon ble Mumbai High Court on any of the above raised objections. If that be the case, the AO is directed to keep the issue alive in the interest of revenue and make suitable adjustments / additions on the issues raised above. 29. The Assessing Officer shall give effect to the above directions as per provisions of section 144C(13) of the Incometax Act, 1961. 6. This aspect has been duly acknowledged by the Assessing Officer in his order as under:- 10. The assessee had contested the above contention before the Hon ble Disputes Resolution Panel-2, Mumbai. Hon ble DRP vide its order u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... If that be the case, the AO is directed to keep the issue alive in the interest of revenue and make suitable adjustments / additions on the issues raised above. Since, the issues involved are contested by the revenue before the Hon ble High Court on the very same grounds as narrated in this order, the additions / adjustments are being made as under: Particulars IN Rs. Total income as per computation of income 00 Additions/Disallowances to income as discussed above: Business Profits @ 5% of Gross Receipts (para No.8 9) 35,54,89,099 Total Income ..... X X X X Extracts X X X X X X X X Extracts X X X X
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