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TMI Blog2019 (11) TMI 1760X X X X Extracts X X X X X X X X Extracts X X X X ..... of the DTAA, a non-resident engaged in construction activities in India would be considered as having a PE in India only if the construction activity continues for a period exceeding twelve months - HELD THAT:- As relying on assessee own case for the AY 2008-09 [ 2018 (8) TMI 438 - ITAT DELHI] we answer the issue in favour of the assessee holding that no income of the assessee on contract executed by the assessee in India can be held to be taxable under Article 5(2)(g) of the DTAA. Grounds of appeal of the assessee are accordingly allowed. - ITA No. 1410/Del/2016 - - - Dated:- 18-11-2019 - SHRI G.S. PANNU, HON BLE VICE PRESIDENT AND SHRI K. NARASIMHA CHARY, JUDICIAL MEMBER For the Revenue : Shri G.K. Dhall, CIT- DR. For the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess than 12 months. 3. Ld. AO passed the order dated 30.1.2012 u/s 143(3)/144C observing that for the reasons recorded in the assessment order for the AY 2008-09, the assessee is held to have PE in India in terms of the duration of assessee s operation in India. While holding that conclusion, ld. AO stated that the assessee has been doing installation and assembly and its role is not confined to mere rock placement in the river section for protection of pipelines and that the assessee s case is squarely covered by Article 13 of the DTAA since the assessee was providing services which are of a technical, managerial consultancy in nature. On that premise, ld.AO made an addition of Rs.9,99,34,354/- being 10% of the gross receipts of the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he purpose of determination of PE under Article 5(2)(g) does not satisfy the threshold period of 12 months. 6. He further submitted for the AY 2008-09 in assessee s own case, a coordinate bench of this Tribunal dealt with this issue at length and reached a conclusion that the threshold period of 12 months was not exceeded in the case of the assessee and consequently, no PE was established under Article 5(2)(g) of the DTAA. He submitted that the facts being identical and the period of six months is distributed in two assessment orders, finding of the Tribunal in assessee s own case for the AY 2008-09 is relevant for this assessment year also and clinches the issue. 7. Learned DR vehemently relied upon the orders of the authorities belo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... January, 2008 (even though ld. Counsel stated that first mobilization of vessel/barge was 23rd February, 2008); and not before that as the preparatory work if any, was for tendering purpose and to get the contract. 13. In so far as the date of completion, the Contract provides the completion date of 1st August, 2008, whereas as per the material placed on record and also the payment schedule etc., points out that all the activities connected with the project including the receiving of the payments was before 30th September 2008 and even the completion certificate mentions 30th September 2008. Though certain formalities for final completion certificate may have exceeded one or two months but still it will not make the continuity of the ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng out such a work and to comply with the certain conditions of Contract there must have been substantive activity before the effective date; and after the date of decommissioning of the project/ demobilisation certain formalities must have been carried out. Such a contention sans any corroborative material cannot be accepted, because the onus is heavily upon the revenue to establish that that assessee s activity had crossed the threshold period of 12 months and hence constitutes PE in India in terms of Article 5(2)(g) so as to tax the receipts in India as per Article 7. 14. Thus, on the facts and material on record and in view of our reasoning given above which is in consonance and in line with the principle laid down in the Hon ble Jur ..... X X X X Extracts X X X X X X X X Extracts X X X X
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