9911796707
TMI Blog2022 (10) TMI 600X X X X Extracts X X X X X X X X Extracts X X X X ..... ected against the order dated 21.05.2021 of the Commissioner of Income Tax (Appeals)-22, Kolkata [hereinafter referred to as the 'CIT(A)] whereas the appeal filed by the assessee is against the order dated 30.03.2022 of the Assessing Officer pursuant to the directions of the Dispute Resolution Panel (hereinafter referred to as the 'DRP'). 2. The assessee is an Airline having its establishment in Bhutan. The issue under consideration in the present appeal is whether the income of the assessee from sale of tickets to air passengers, insurance and fuel charges, etc. in India is to be taxable in India or not. In the Assessment order for AY 2017-18, the ld. Assessing Officer held that as the assessee was having its "Permanent Establishment (PE) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee has further contended that these guidelines were not given effect to by the ld. Assessing Officer in right perspective, rather held that assessee is having a "PE" one at Kolkata and another at Delhi, hence its income was taxable in India. The assessee, therefore, has come in appeal before this Tribunal for AY 2018-19, vide ITA No. 314/Kol/2022. 4. Before, proceeding further, it will be relevant to reproduce here the relevant provisions of section 9 and section 90 of the Income Tax Act and also the relevant clauses/articles of the Indo-Bhutan DTAA. "Income deemed to accrue or arise in India. 9. (1) The following incomes shall be deemed to accrue or arise in India :- (i) all income accruing or arising, whether directly or indirect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of income-tax chargeable under this Act or under the corresponding law in force in that country or specified territory, as the case may be, or investigation of cases of such evasion or avoidance, or (d) for recovery of income-tax under this Act and under the corresponding law in force in that country or specified territory, as the case may be, and may, by notification in the Official Gazette, make such provisions as may be necessary for implementing the agreement. (2) Where the Central Government has entered into an agreement with the Government of any country outside India or specified territory outside India, as the case may be, under subsection (1) for granting relief of tax, or as the case may be, avoidance of double taxation, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... operation of such ships or aircraft if they are integral to the carrying on of such business, and the provisions of ARTICLE 11 shall not apply in relation to such interest. 5. The provisions of paragraph 1 shall also apply to profits from the participation in a pool, a joint business or an international operating agency. Further the term "International Traffic has been defined as under: 1. For the purposes of this Agreement, unless the context otherwise requires: (h) the term "international traffic" means any transport by a ship or aircraft operated by an enterprise that has its place of effective management in a Contracting State, except when the ship or aircraft is operated solely between places in the other Contracting State; 5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n; (c) the use, maintenance or rental or containers (including trailers and related equipment for the transport of containers) in connection with such transportation; and (d) any other activity directly connected with such transportation." 8. We find that in the above definition the profit derived "Profits derived from the operation of ships or aircraft in international traffic", in the India- Singapore DTAA is exhaustive enough not only to include the air passengers but also mail, livestock or goods. There is nothing mentioned in the India-Singapore DTAA to make an inference that the profits from transport of air passengers should not be covered under Article 8 of the Indo-Bhutan DTAA. 9. In view of the above observations, the iss ..... X X X X Extracts X X X X X X X X Extracts X X X X
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