DAE(SY22) LEASING (IRELAND)41, DESIGNATED ACTIVITY COMPANY ,MUMBAI vs. ASSISTANT COMMISSIONER OF INCOME TAX INTERNATIONAL TAXATION CIRCLE 2(1)(2), MUMBAI

ITA 1157/MUM/2025Status: DisposedITAT Mumbai13 August 2025AY 2022-23Bench: SHRI AMIT SHUKLA (Judicial Member), MS PADMAVATHY S (Accountant Member)122 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that the leased aircraft were operated in international traffic, thus falling under Article 8 of the India-Ireland DTAA, which grants exclusive taxation rights to the country of residence. Consequently, no Permanent Establishment (PE) existed in India, and the lease rentals were not taxable in India.

What were the facts?

The appeals involved Irish aircraft leasing companies challenging assessment orders for AY 2022-23. The core issue was the taxability of lease rentals in India, with the assessees claiming benefits under the India-Ireland Double Taxation Avoidance Agreement (DTAA).

What were the issues?

The key issues were the existence of a Permanent Establishment (PE) in India, the applicability of Article 8 of the India-Ireland DTAA for aircraft leasing income, and whether lease rentals constituted royalty or business income.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 144C,Section 153,Section 234A,Section 234B,Section 270A,Section 274,Section 9(1)(vi)

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Cases cited in this judgment(12)Show list

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IN THE INCOME TAX APPELLATE TRIBUNAL, „I‟ BENCH MUMBAI BEFORE: SHRI AMIT SHUKLA, JUDICIAL MEMBER & MS PADMAVATHY S, ACCOUNTANT MEMBER ITA No. AY Assessee/ Respondent Appellant ITA No. 2022-23 Sky High Appeal XLIII The Assistant 1122/Mum/2025 Leasing Company Commissioner Limited of Income Tax 2, Grand Canal Square (International Grand Canal Harbour Tax) Circle Dublin, D02 A342 4(2)(1), Ireland Mumbai C/o. DMD Advocates 30, Nizamuddin East, New Delhi-110 013 PAN: ABFCS0569K SA 2022-23 Sky High Appeal XLIII The Assistant No.38/Mum/2025 Leasing Company Commissioner (Arising out of Limited of Income Tax ITA No. 2, Grand Canal Square (International 1122/Mum/2025 Grand Canal Harbour Tax) Circle Dublin, D02 A342 4(2)(1), Ireland Mumbai C/o. DMD Advocates 30, Nizamuddin East, New Delhi-110 013 PAN: ABFCS0569K ITA No. 2022-23 Ortus Aircraft Lease Deputy 1106/Mum/2025 6 (Doublin) Limited Commissioner 32, Molesworth of Income Street, Dublin 2, Tax, Ireland.

International C/o. DMD Advocates Tax, Circle 30, Nizamuddin East, 3(2)(2), New Delhi-110 013 Mumbai PAN: AADCO1624J SA 2022-23 Ortus Aircraft Lease Deputy No.37/Mum/2025 6 (Doublin) Limited Commissioner ITA 32, Molesworth of Income No.11

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