9911796707
TMI Blog2023 (9) TMI 587X X X X Extracts X X X X X X X X Extracts X X X X ..... meeting etc. We find that DRP/AO has not controverted the genuineness of the different contracts executed by the assessee company with the different clients to whom it had rendered services pertaining to core components for manufacturing of cement. It is also noticed that the DRP/AO has not brought on record any other material to demonstrate that assessee has not acted directly for providing services to the clients in India and it has also not been established that how the assessee used the premises and services of its associate enterprise (subsidiary company namely (GIPL) in India. Therefore, we consider that AO/DRP is not justified in holding that assessee has used the premises of its associate company in India for rendering services to its clients. Assessee appeal allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant. Further the observation made in the impugned order (Page 15) are totally incorrect and based on surmises, 8. That the Assessing Officer has grossly erred both on facts and in law in the interpretation of various judicial decisions of the courts and the reports of OECD in the impugned assessment order passed and in applying the same to the facts and circumstances of the case of the Appellant company. 9. That the Assessing Officer/DRP has grossly erred both on facts and in law in appreciating that the Appellant company satisfies the conditions of a fixed place PE under Article 5(1) of the Treaty without any basis and any contrary evidence; 10. That the Learned Assessing Officer/DRP has grossly erred in not appreciating the fact that the Appellant has Gross revenue from Business of Rs. 1,31,81,590/ in India inspite of the documentary evidences submitted by the Appellant. The Learned Assessing Officer/DRP has grossly erred in holding that the gross revenue declared by the Appellant in the Return of Income is the net profit of the business of the Appellant from India which is factually incorrect. 11. That the Learned Assessing Officer/DRP has grossly erred in attribu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Income Tax Act; That the above grounds of Appeal are independent and without prejudice to each other. That the Appellant reserves its right to add, alter, amend or withdraw any ground of appeal either before or at the time of hearing of this appeal." 2. Fact in brief is that the assessee is a tax resident of Germany having its office at Barbarossastr 50-54, Kaiserlautern, 676550 Germany. The assessee has filed return of income for the year under consideration on 17.11.2017 declaring total income of Rs. 2,97,33,239/-. The assessee company was into the business of providing design and engineering services and supply of equipment relating to the setting up of cement & allied industries. The case of the assessee was selected for scrutiny and notice u/s 143(2) of the Act was issued on 13.08.2018. During the year under consideration the assessee received receipt on account of the supervision, installation and commissioning of equipment. A part of these income Rs. 1,65,51,649/- assessee has claimed to be in the nature of royalty/fee for technical services (FTS) on gross basis and offered the income for taxation as per provisions of Article 12 of the India-Germany DTAA. The re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... International Taxation Circle 2(3)(2), Mumbai) vide his draft Assessment order dated 11.12.2019, is being objected to by the assessee under the Provisions of Section 144C (2) (b) on the following objections which may be read separately: 1. That the Learned Assessing Officer has grossly erred both on facts and law in passing the impugned order, 2. That the Learned Assessing Officer has grossly erred in the interpretation of Article 5 and Article 7 of the DTAA between India and Germany, 3. That the Learned Assessing Officer has grossly erred both on facts and law in considering M/s GEBR Pfeiffer India Private Limited as Permanent Establishment (PE) of the Assessee ie, GEBR. Pfeiffer SE; 4. That the Learned Assessing Officer has grossly erred both on facts and law in considering M/s GEBR Pfeiffer India Private Limited as Permanent Establishment (PE) of the Assessee, as the assessee is a holding company of M/s GEBR Pfeiffer India Private Limited. 5. That the Learned Assessing Officer has grossly erred both on facts and law in considering that the assessee has business connection in India through its AE namely M/s GEBR Pfeiffer India Pvt Ltd. 6. That the Learned Asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 15. That the learned Assessing Officer has grossly erred in levying of interest under section 234A, 2348, 234C & 234D which in any case could not been charged. 16. That the learned Assessing Officer has grossly erred in initiating penalty proceedings under section 270A read with Section 274 of the Income Tax Act. 17. That the learned Assessing Officer has grossly erred in initiating penalty proceedings under section 271BA read with Section 274 of the Income Tax Act." The assessee has submitted before the DRP that there was no permanent establishment (PE) of the company in India as per Article 5 of the India Germany DTAA. It was also explained that assessee's subsidiary in India Gebr Pfeiffer India Pvt. Ltd. was engaged in the business of non -core items whereas the assessee was engaged in business of production of core components and the assessee company had entered into a composite contract with different companies in India for sale of capital goods manufactured by it. (core components and related supervision services) and also for services relating to supervision, installation and commissioning of imported components of cement grinding mill to parties in India namely, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 'ble Supreme Court of India in the case of ADIT vs E- Funds IT Solution Inc reported in 399 ITR 34. 3. Order of Hon'ble ITAT Delhi in the case of AB Sciex Pte Ltd. vs ACIT in ITA No. 514/Del/2021. 4. Order of Hon'ble ITAT Delhi in the case of Swiss Re-Insurance Company Limited vs DDIT in ITA No. 1667/Mum/2014. 5. Order of Hon'ble ITAT Delhi in the case of DCIT vs Marubheni Corporation, Japan in ITA No. 10/Mum/2022. 6. Judgment of Hon'ble High Court of Delhi in the case of National Petroleum Construction Company vs DIT reported in 383 ITR 648." On the other hand, the ld. D.R submitted that assessee has maintained a fixed place of business through its subsidiary concern, i.e Gebr Pfeiffer India from where significant core activities of the assessee company were carried out. The ld. D.R also relied on the finding of DRP holding that the assessee has fixed place as a PE in India. 5. Heard both the sides and perused the material on record. The assessee is a resident of Germany and engaged in the business of design, engineering and supply of machinery, spare, supervision, erection and commissioning grinding plant for cement manufacturing company. Withou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mendments dated 30/12/2014 & 18/11/2015. 9. Supervision Contract between Jaypee Cement Corporation Limited and GEBR PFEIFFER SE dated 3rd May 2016. 10. Details of engineers visited India to carry out contractual obligation with copies of the minutes of meetings." However, neither the A.O nor the DRP has specifically disputed these contracts in their finding. We have perused the copy of these contracts placed in the paper book i.e supervision contract between Shree Cement Ltd. & assessee dated 11.03.2013 wherein detail of scope of service, price terms of payment and nature of work were mentioned with other particular. Similarly, we have also perused the separate supervision contract executed by the assessee company with Emami Cement Ltd. on 09.06.2016 and also separate supervision contracts with Jaypee Cement Corporation on 03.05.2016 wherein the terms and conditions and scope of the work etc, were mentioned. The assessee has also furnished the detail of engineers visited India to carry out contractual objection with copies of the minutes of the meeting etc. However, we find that DRP/AO has not controverted the genuineness of the different contracts executed by the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
