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TMI Blog2023 (11) TMI 1322X X X X Extracts X X X X X X X X Extracts X X X X ..... . Gupta, Advocate Ms. Shruti Khimta, Advocate Ms. Saloni Shital, AR. For the Department : Sh. Vizay B. Vasanta, CIT(DR). ORDER PER SAKTIJIT DEY, V.P. Captioned appeal has been filed by the assessee challenging the final assessment order dated 20.01.2023 passed under section 143(3) read with section 144C(13) of the Income-tax Act, 1961 (in short the Act ) pertaining to assessment year 2020-21, in pursuance to the directions of learned Dispute Resolution Panel (DRP). 2. The core issue arising in the present appeal is whether the assessee had a Permanent Establishment (PE) in India in terms of Article 5 of India Switzerland Double Taxation Avoidance Agreement (DTAA) and in case there is a PE, attribution of profit to the said PE. 3. Briefly th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the said DTAA. 5. Learned Departmental Representative, though, agreed that the issue is covered by the decision of the Tribunal in assessment years 2018-19 and 2019-20, however, he relied upon the observations of the Assessing Officer and learned DRP. 6. We have considered rival submissions and perused the materials on record. There is no dispute that the factual position qua the issue whether the assessee had a PE in India in the impugned assessment year, is identical to assessment years 2018-19 and 2019-20 as the departmental authorities, while coming to conclusion that the assessee had a PE in India, have entirely relied upon the assessment history of the assessee in assessment years 2018-19 and 2019-20. It is observed, while decidin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vant for deciding the existence of PE in the impugned assessment years. It is observed, while deciding identical issue in case of Nuovo Pignone International SRL Vs. DCIT (supra) involving identical facts, the Coordinate Bench has held as under: 10. We have considered rival submissions and perused materials on record. We have also applied our mind to the judicial precedents cited before us. The short issue arising for consideration is whether the assessee had a PE, either fixed place PE or dependent agent PE, in India during the year under consideration. No doubt, the past assessment history of the assessee reveals that existence of PE in India was upheld by the Tribunal and Hon ble jurisdictional High Court in assessment years 2002-03 to 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of PE, no longer exists in the impugned assessment year. 12. This is clearly evident from the submissions made and documents filed before the departmental authorities. Despite such submissions and evidences produced by the assessee, the departmental authorities have remained oblivious to such facts and materials brought on record and proceeded to conclude existence of PE merely relying upon the past orders passed by them and higher appellate authorities. It is trite law, the existence or otherwise of PE has to be determined on year to year basis, as the existence of PE has to be decided based on the definition of PE in the relevant tax treaty. Merely because in one year, the assessee had a PE in India, that by itself cannot lead to the conc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal High Court, while dealing with the issue of reopening of assessment based on information received from third party, observed, though such information can form basis for an examination/investigation by the Assessing Officer, but the decision to reopen the assessment has to be of the Assessing Officer and not of the third party. The Assessing Officer cannot merely do a cut and paste job for reopening the assessment without independent application of mind or verification or investigation. The aforesaid ratio laid down by Hon ble jurisdictional High court squarely applies to the facts of the present appeal, as the departmental authorities have merely followed the decision taken by them and higher appellate authorities in assessee s cases in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts of the present appeals also, the departmental authorities have failed to controvert either the submission or the materials and evidences brought on record by the assessees to demonstrate that they did not have any PE in India in these assessment years. In fact, even at the stage of Tribunal, no contrary material has been brought on record by the Revenue to rebut the claim of the assessees that no PE existed in these years. 8. That being the factual position emerging on record, we hold that the decision taken in case of Nuovo Pignone International SRL Vs. DCIT (supra) would squarely apply to the facts of the present appeals. Accordingly, we hold that the assessees did not have any PE in India in the assessment years under dispute so as to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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