DSD NOELL GMBH,NEW DELHI vs. ACIT (INTERNATIONAL TAXATION), NEW DELHI

ITA 255/DEL/2017Status: DisposedITAT Delhi21 November 2023AY 2012-13Bench: SHRI CHALLA NAGENDRA PRASAD (Judicial Member), SHRI M. BALAGANESH (Accountant Member)47 pages
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What did the Tribunal hold?

The Tribunal held that the offshore services, including drawings and designs, were inextricably linked to the supply of plant and equipment and constituted business profits. Since these services were rendered outside India and the Permanent Establishment (PE) in India had no role in their rendition, the income was not taxable in India as FTS or business profits attributable to the PE.

What were the facts?

The assessee, DSD Noell GMBH, received payments for offshore services including planning, drawings, and designs, which were linked to the supply of plant and equipment for a power project in India. The tax authorities treated these offshore services as 'Fees for Technical Services' (FTS).

What were the issues?

Whether offshore services for planning, drawings, and designs, linked to the supply of plant and equipment, constitute 'Fees for Technical Services' or business profits taxable in India, considering the India-Germany DTAA and the role of a Permanent Establishment.

Which sections of the Income-tax Act were involved?

Section 9(1)(vii)

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

For Appellant: Ms. Shruti Srivastava, CA
Hearing: 23/08/2023Pronounced: 21/11/2023

Heard together (4 matters)

ITA No.255/Del/2017
ITA No.7070/Del/2018
ITA No.115/Del/2021
ITA No.3186/Del/2016

Read from the judgment's own cause title. This page is filed under one of them.

PER M. BALAGANESH AM: All these appeals of the Assessee arises out of the orders of the Learned Commissioner of Income Tax (Appeals)-42, New Delhi [hereinafter referred to as ‘Ld. CIT(A)], against the order passed by Assistant Director/Assistant Commissioner of Income Tax, Circle-1(2), International Taxation, New Delhi for Assessment Years 2011-12, 2012-13, 2014-15, 2015-16, 2016-17, 2017-18 & 2018-19. 3. The assessee has raised the following gro

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