SKY HIGH XCV LEASING COMPANY LIMITED,STATE OUTSIDE INDIA vs. THE ASSISTANT COMMISSIONER OF INCOME-TAX (INTERNATIONAL TAX), CIRCLE 3(1)(2), DELHI, DELHI

ITA 1484/DEL/2025Status: DisposedITAT Delhi31 October 2025AY 2022-235 pages
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What did the Tribunal hold?

The Tribunal held that the leases were operating leases, the assessees were eligible for benefits under the India-Ireland DTAA, and the leased aircraft did not constitute a PE in India. It also ruled that the MLI did not automatically render the DTAA inoperative without specific notification.

What were the facts?

The assessees, Irish tax residents, leased aircraft to Indian aviation companies. The Assessing Officer treated the leases as finance leases, denied DTAA benefits, and held that the aircraft constituted a Permanent Establishment (PE) in India.

What were the issues?

The key issues were the nature of the lease (operating vs. finance), the applicability of the India-Ireland DTAA and the MLI, and whether the leased aircraft constituted a Permanent Establishment in India.

Which sections of the Income-tax Act were involved?

Section 90(1)

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आयकर अपीलीय अिधकरण िद"ी पीठ “डी”, िद"ी "ी िवकास अव"थी, "ाियक सद" एवं "ी कृणवंत सहाय, लेखाकार सद" के सम" IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “D”, DELHI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER & SHRI KRINWANT SAHAY, ACCOUNTANT MEMBER आअसं.1483/िद"ी/2025(िन.व. 2022-23)

Sky High XXII Leasing Company Ltd. 2, Grand Canal Square, Grand Canal Harbour, Dublin D02 A342, Ireland ...... अपीलाथ"/Appellant PAN: ABFCS-0567-H बनाम Vs.

Assistant Commissioner of Income Tax, International Taxation, Circle 3(1)(2), Civic Centre, ..... "ितवादी/Respondent Minto Road, New Delhi 110002 आअसं.1484/िद"ी/2025(िन.व. 2022-23)

Sky High XCV Leasing Company Ltd., 2, Grand Canal Square, Grand Canal Harbour, Dublin D02 A342, Ireland ...... अपीलाथ"/Appellant PAN: ABFCS-0568-J बनाम Vs.

Assistant Commissioner of Income Tax, International Taxation, Circle 3(1)(2), Civic Centre, ..... "ितवादी/Respondent Minto Road, New Delhi 110002 Assessee by : Shri Percy Pardiwalla Sr. Advocate with S/Shri Madhur Agarwal, Harsh R. Shah & Pratik Poddar Advocates Department by : Shri M.S Nethrapal, CIT-DR सुनवाई क" ितिथ/ Date of hearing : 30/09/2025 घोषणा क" ितिथ/ Date of pronouncement : : 31/10/2025 (AY 2022-23) आदेश/O

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