Tax Management India. Com
Law and Practice  :  Digital eBook
Research is most exciting & rewarding
  TMI - Tax Management India. Com
Follow us:
  Facebook   Twitter   Linkedin   Telegram
Income Tax - Highlights / Catch Notes

Home Highlights November 2024 Year 2024 This

The assessee had artificially split the composite contract to ...


Foreign Company Avoids Tax by Splitting Contracts, Court Rejects Permanent Establishment Claim.

Case Laws     Income Tax

November 13, 2024

The assessee had artificially split the composite contract to avoid establishment of a permanent establishment (PE) in India and tax payment. The Assessing Officer (AO) held that the assessee has a PE in India in the form of a fixed place and dependent agent PE (DAPE) through GE Power India Ltd. (GEPIL). However, the Coordinate Bench of the Tribunal, on similar facts for the same assessee for Assessment Years 2018-19 and 2019-20, had held that there is no business connection of the assessee in India, and no fixed place PE or construction PE exists. Consequently, the provisions of Section 44BBB of the Act are not applicable. Therefore, the receipts from offshore supplies and the amount received from GEPIL are not taxable in India. The addition made by the AO by bringing offshore supply receipts to tax is directed to be deleted. Interest u/s 234B is consequential and the AO is directed to levy it accordingly.

View Source

 


 

You may also like:

  1. PE in relation to moving ship - The foreign enterprise has the place of permanent establishment in this Country. The foreign enterprise thus satisfying the presence a...

  2. The High Court, following the judgment in G.M. Knitting Industries (P.) Ltd., held that filing a foreign tax credit claim u/r 128 is directory and not mandatory. The...

  3. Amendment of section 115JB. - Minimum Alternate Tax (MAT) shall not be applicable to a foreign company, w.e.f. 01.04.2001 if the foreign company does not have as a...

  4. Income taxable in India or not - Taxation of Technical Collaboration Fees @ 10% u/s. 9(1)(vii) r.w.s 115A(1)(b) - The Appellate Tribunal considered the arguments...

  5. Income accrued in India - taxation of interest income - assessee is a company incorporated and fiscally domiciled in the Republic of Japan - For interplay of Article...

  6. TDS u/s 195 - Disallowance of sales commission paid to foreign agents - There is no dispute that these foreign agents do not have permanent establishment in India and...

  7. TDS u/s 195 - Disallowance of commission expenditure paid to foreign agents for non-deduction of tax - Assessee has consistently denied that they do not have any...

  8. Clubbing of income of Non-resident and Permanent Establishment (PE) - Levy of surcharge at 5% as against assessee’s claim of 2% - The royalty and Fee for Technical...

  9. TDS u/s 195 - Disallowance u/s 40(a)(i) - payment made to International Freight Forwarding Agents (related companies) - those foreign companies are independent legal...

  10. Export of Business auxiliary service - The appellant promoted the business of such foreign companies in India and as a consideration for this service, the appellant...

  11. TDS u/s 195 - Disallowance u/s 40(a)(i) - the said income in the hands of non-resident has to be considered in the light of the provisions of DTAA between India and the...

  12. Income accrued in India - permanent establishment (PE) - Withholding of tax in India - vessel engaged in seismic survey at high sea - The sum paid by the applicant to...

  13. The case before the Calcutta High Court involved the classification of a company for taxation purposes. The court determined that the appellant company did not qualify...

  14. Insertion of new Chapter XII-BC- Foreign company said to be resident in India - where a foreign company is said to be resident in any previous year and such foreign...

  15. Foreign Tax Credit u/s. 90 - Assessee did not file Form 67 at the time of filing of her return of income - Referring to established case law, the Tribunal affirmed that...

 

Quick Updates:Latest Updates