DDIT CIRCLE -3(1)(1), NEW DELHI vs. WESTERN UNION FINANCIAL SERVICES INC., NEW DELHI

ITA 1381/DEL/2019Status: DisposedITAT Delhi14 February 2022AY 2015-1616 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal, following its own prior decisions in the assessee's own case for earlier assessment years, found parity of facts. Consequently, the Tribunal declined to interfere with the CIT(A)'s findings.

What were the facts?

The revenue appealed against the CIT(A)'s order which held that income from money-transfer services and the existence of a Permanent Establishment (PE) in India were not taxable. The assessee argued that these issues were decided in their favor in previous assessment years.

What were the issues?

Whether the income from money-transfer services is taxable in India and whether the assessee has a Permanent Establishment (PE) in India, including its agents and software, are the key issues.

Which sections of the Income-tax Act were involved?

Article 7

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘D’, NEW DELHI

Before: SH. N. K. BILLAIYA & MS. ASTHA CHANDRA

Hearing: 14/02/2022Pronounced: 14/02/2022

This appeal filed by the revenue is preferred against the order of the CIT(A)-43, New Delhi dated 20.12.2018 for A.Y. 2015-16.

The grievance of the revenue read as under :-

Whether on the facts and in the circumstances of the case and in law, the CIT(A) has erred in holding that the income earned by the assessee from the business of money-transfer services in respect of remittances made to individuals in India is not liable to tax in India.

2. Whether on the facts and in the circumstances of the case and in law, the CIT(A) has erred in holding that the assessee does not have a Permanent Establishment (‘PE’) in India and therefore, profits attributable to operation in India are not liable to taxed in India as business profits in terms of the Article 7 of the India- USA DTAA. 3. Whether on the facts and in the circumstances of the case and in law, the CIT(A) has erred in holding that the software application installed on the machines in the premises of the agents and dedicated to the business of the money-transfer, do not constitute assessee’s Permanent Establishment in India. 4. Whether on the facts and in the circumstances of the case and in law, the CIT(A) has erred in holding that the representatives of the assessee in India do not constitute its Dependent Agent PE in India. 5. Whether on the facts and in the circumstances of the case and in law, the CIT(A) has erred in not attributing to India any profits against the business activities carried by it through it PE in India. 6. The appellant prays for leave to add, amend, modify or alter any grounds of appeal at the time or before the hearing of the appeal

At the very outset the counsel for the assessee stated that the issues raised by the revenue have been decided by the Tribunal in assessee’s own case in earlier assessment years and drew our attention to the relevant decisions of this Tribunal.

Per contra the DR fairly conceded to this.

We have carefully perused the orders of the authorities below. The order of the CIT(A) shows that at para -5.5 he has followed the earlier years orders in assesee’s own case and allowed the appeal of the assessee.

This Tribunal in order dated 20.09.2021 for A.Y.2013-14 had the occasion to consider the similar grievance. The relevant findings of the coordinate Bench read as under :-

On finding parity of facts, respectfully following the decision of the coordinate Bench (supra) we decline to interfere with the findings of the CIT(A).

In the result, the appeal filed by the revenue is accordingly dismissed.

The order is pronounced in the open court on 14.02.2022 in the presence of both the rival representatives.

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