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TMI Blog2021 (3) TMI 1440X X X X Extracts X X X X X X X X Extracts X X X X ..... ses have been at the disposal of the assessee during their period of stay. The employees has stayed for a period of 158 days as per the assessee in India while rendering the services. In terms of OECD commentary on Article 5(1) the assessee can be said to be having a permanent establishment owing to existence of a place of business i.e. a facility such as premises, and that place was fixed and established as a distinct place with certain degree of permanence and the foreign enterprise (the assessee) is carrying the business through this fixed place i.e. the premises of the hotel. The assessee can be said to be dependent on the personnel to conduct the business of the foreign enterprise in the State in which the fixed place situated. The ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 9(1)(vi) of the Income Tax Act, 1961 ( the Act ) and Article 12 of the Tax Treaty - For the sake of ready reference and convenience, operative part of the order [ 2019 (12) TMI 1667 - ITAT DELHI] as based on the clauses of the Strategic Service Agreement and Strategic Oversight Agreements, we hold that the revenue s earned by the assessee are taxable under Article 12 of the DTAA. Regarding the determination of the profit, taken up at ground no. 4 by the assessee, we hereby hold that the taxable profits may be computed in accordance with the provisions of Section 44DA of Indian Income Tax Act and Article 12 of Indo-UAE, DTAA. During the arguments, it was also submitted that the assessee has incurred losses in the assessment year 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 79/Del/2014, 1762/Del/2015 and 957/Del/2016 is being reproduced herewith. 56. We find that from the concurrent reading of the Strategic Oversight Agreements (SOA), the assessee has been technically operating the hotel belonging to the owners namely, Asian Hotels Ltd. (AHL) through the employees who are recruited by them. The hotel premises have been at the disposal of the assessee during their period of stay. The employees has stayed for a period of 158 days as per the assessee in India while rendering the services. In terms of OECD commentary on Article 5(1) the assessee can be said to be having a permanent establishment owing to existence of a place of business i.e. a facility such as premises, and that place was fixed and establishe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at both the parties comply with their obligations to the contract for a long period of time will constitute a permanent establishment. As long as, the premises is at the disposal of the assessee and having the right to use the premises for the purpose of the assessee s business on behalf of the party to the agreement can constitute a fixed place PE. We also find that the physical criteria (existence of a geographical location), subject to criteria (right to use the place) and the functional criteria (carrying on the business through that place) as mentioned in the OECD principles with relation to the existence and determination of PE as held by the Mumbai Tribunal in the case of Air Lines Rotables Vs JDIT 131 TTJ 385 have been found to be m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ( the Act ) and Article 12 of the Tax Treaty: 5. At the outset, it was brought to the notice of the Bench that the grounds raised in the appeal of the assessee for the assessment year 2013-14 stands adjudicated by the order of the Co-ordinate Bench of the ITAT for the assessment years 2009-10 to 2012-13. It was submitted that the assessee incurred operating losses during the year. 6. The ld. DR has not disputed the factual position. 7. For the sake of ready reference and convenience, operative part of the order dated 04.12.2019 in ITA No. 579/Del/2013, 779/Del/2014, 1762/Del/2015 and 957/Del/2016 is being reproduced herewith. 60. Based on the clauses of the Strategic Service Agreement and Strategic Oversight Agreements, we ..... X X X X Extracts X X X X X X X X Extracts X X X X
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