9911796707
TMI Blog2006 (3) TMI 121X X X X Extracts X X X X X X X X Extracts X X X X ..... llowed the appeal filed by the assessee in part. Appeals Nos. 473 of 2001, 474 of 2001 and 475 of 2001 have been filed by the appellants against the common order dated May 3, 2000, passed by the Income-tax Appellate Tribunal, New Delhi (in short "the ITAT") in I. T. A. Nos. 2494 of Del of 93 (assessment years 1986-87, 1987-88 and 1988-89), 5612 of Del of 91 and 5467 of Del of 91 respectively (both assessment years 1987-88 and 1988-89), whereby the learned Income-tax Appellate Tribunal has dismissed the cross objections of the Revenue on the agreement of the parties that the issue involved in the present cross objections stand covered in favour of the assessee by the decision of the Tribunal in I. T. A. Nos. 162 of 165 (Del) of 1998 dated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on was scheduled by the end of March. The assessment for both the assessment years was completed on March 29, 1990, holding that the company was having a "permanent establishment" for both the assessment years and assessed income taking 2 per cent. on receipts in respect of outside India activities. Notice was issued for the assessment year 1986-87 on March 30, 1990, and assessment was completed on June 8, 1992 under the Double Taxation Avoidance Agreement. Aggrieved by the assessment orders, the assessee preferred appeals before the Commissioner of Income-tax (Appeals), Dehradun, who held that the assessee-company did have a "permanent establishment" but reduced the income in respect of receipts for outside India operations to 1 per cent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee had a "permanent establishment" in India, article 5 of the CADT is being reproduced as under: "(1) For the purposes of this Convention, the term 'permanent establishment' means a fixed place of business through which the business of an enterprise is wholly or partly carried on. (2) The term 'permanent establishment' shall include especially (a) a place of management; (b) a branch; (c) an office; (d) a factory ; (e) a workshop; and (f) a mine, an oil or gas well, a quarry of any other place of extraction of natural resources. (3) The term 'permanent establishment' likewise encompasses a building site, a construction, assembly, or installation project or supervisory activities in connection therewith, but only wher ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment year 1988-89, specially where the assessee had failed even before the tax authorities to support its facts and figures and we have upheld the application to section 145. The Income-tax Appellate Tribunal was right in rejecting the argument of zero profit on the Indian operations and to accept the alternative argument holding that Instruction No. 1767 is after all a guideline and computation can be made under the relevant provisions of the Act read with the guidelines themselves. The Income-tax Appellate Tribunal after detailed discussions held that Instruction No. 1767 is after all a guideline and computation can be made under the relevant provisions of the Act read with the guidelines themselves and further held that it would be fai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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