← All Phrases

“permanent establishment”

International TaxSection 9 / DTAA Article 5Section 9 / DTAA Article 51,497 judgments

The decision most relied on for permanent establishment is DIT v. Morgan Stanley & Co. (292 ITR 416), cited in 360 judgments on BharatTax.

Leading authorities on permanent establishment

DIT v. Morgan Stanley & Co.
292 ITR 416 · 2007 · Supreme Court
360
citing judgments

A Permanent Establishment (PE) signifies a foreign enterprise's virtual projection into another country, with a fixed place PE existing where an MNE's business is wholly or partly carried on. A dependent agent PE requires the agent to act as such and/or have the authority to conclude contracts for the foreign enterprise under DTAA provisions.

DIT v. Nokia Networks OY
358 ITR 259 · 2013 · High Court
276
citing judgments

Payments for the supply of software along with telecom equipment are not in the nature of royalty if they are for the use of a copyrighted article, not the copyright itself. Such payments are not taxable in India in the absence of a Permanent Establishment (PE).

DIT v. Infrasoft Ltd.
39 Taxmann.com 88 · 2013 · High Court
269
citing judgments

Payments for the use of copyrighted software, without the transfer of any rights in the underlying copyright itself, do not constitute 'royalty' under the Income-tax Act or tax treaties. Such payments are often treated as business income, taxable only if a permanent establishment exists.

ONGC v. CIT
376 ITR 306 · 2015 · Supreme Court
241
citing judgments

Income derived by a non-resident for services related to mineral oil operations, falling under the presumptive taxation regime of Section 44BB, cannot simultaneously be treated as fees for technical services under Section 9(1)(vii). The specific presumptive provisions override the general FTS definition, particularly when DTAA applies.

Motorola Inc. v. Dy. CIT
95 ITD 269 · 2005 · High Court
213
citing judgments

Revenue must demonstrate the existence of a Permanent Establishment (PE) of a foreign enterprise in India, including establishing that transactions underlying a Dependent Agent PE were not at arm's length. Income from the sale of goods is not taxable in India if title and risk in the goods pass outside India.

(i) Formula One World Championship Ltd. v. CIT
394 ITR 80 · 2017 · Supreme Court
200
citing judgments

This case provides foundational principles that illuminate the contours of the concept of 'Permanent Establishment' (PE) under tax treaties, especially regarding a 'fixed place' PE.

DIT v. Morgan Stanley Co. Inc.
399 ITR 34 · 2017 · Supreme Court
162
citing judgments

Once a transfer pricing analysis has been undertaken for an Indian associated enterprise, no further profits are attributable to it as a Permanent Establishment, thereby extinguishing the need for additional profit attribution.

Sir Kikabhai Premchand v. CIT
24 ITR 506 · 1953 · Supreme Court
156
citing judgments

One cannot make a taxable profit or loss from transactions with oneself, as profit only arises from dealings with external third parties, even when transferring assets between different accounts or divisions of the same entity.

Judgments citing permanent establishment

M/S Tdk India Limited (Formerly Known As Epcos India Pvt. Ltd.), Kolkata vs. DCIT, Cir. -11(1), Kolkata

In the result, both the appeal of the assessee are partly allowed for statistical purposes

ITA 203/KOL/2021[2016-17]Status: DisposedITAT Kolkata22 Jan 2025AY 2016-17

Bench: Shri Rajesh Kumar&Shri Pradip Kumar Choubey]

Section 144C(5)Section 92C

Supreme Court as to whether stewardship activity rendered by the holding company for the Indian subsidiary in India would constitute a Permanent Establishment (PE) within the meaning of Article 5(2)(1) of the DTAA between India and USA. However, in the present case, the factual dispute ... Supreme Court as to whether stewardship activity rendered by the holding company for the Indian subsidiary in India would constitute a Permanent Establishment (PE) within the meaning of Article 5(2)(1) of the DTAA between India and USA. However, in the present case, the 10 I.T.A. No.203/Kol/2021 Assessment Year

Buro Happpold Limited, Mumbai vs. Deputy Commissioner of Income Tax, International Taxation -1(3)(2), Mumbai

In the result, the appeal of the assessee is partly allowed

ITA 4350/MUM/2023[2021-22]Status: DisposedITAT Mumbai20 Jan 2025AY 2021-22

Bench: Shri Sandeep Gosain () & Shri Omkareshwar Chidara () Assessment Year: 2021-22

For Appellant: Shri Vijay Mehta/ Nishit ParikhFor Respondent: Shri S. G. Menon, Sr. DR
Section 144C(5)Section 9(1)(vi)Section 9(1)(vii)

shall not be Income falling under Article 7 of the DTAA. Such business income shall not be taxable in India in the absence of Permanent Establishment taxable in India in the absence of Permanent Establishment taxable in India in the absence of Permanent Establishment (PE) of the assessee in India ... above services would be qualified as consultancy services and hence the above services would be qualified as business income and in the absence of Permanent Establishment (PE) of the ness income and in the absence of Permanent Establishment (PE) of the ness income and in the absence of Permanent Establishment

Inder Chand Bajaj, Delhi vs. DCIT, Central Circle-32, Delhi

In the result, all the appeals of the appellant/revenue are dismissed

ITA 2873/DEL/2022[2018-19]Status: DisposedITAT Delhi17 Jan 2025AY 2018-19

Bench: Shri Brajesh Kumar Singh & Shri Vimal Kumarassessment Year: 2018-19 Assessment Year: 2019-20 Assessment Year: 2020-21 Assessment Year: 2021-22 Assistant Commissioner Of Vs. Italian Thai Development Income Tax Public Company, 301 302 Delhi Tower District Centre Janakpuri, Janakpuri A-3 S.O. Janakpuria-3 West Delhi Pin: 1100 58 Delhi Pan: Aabci2013D (Appellant) (Respondent)

For Appellant: Shri S.R. Wadhwa, Adv. & MsFor Respondent: Shri Rohit Garg, CIT DR
Section 1Section 143(2)Section 143(3)Section 250

under: “5.1.1 Grounds No. 1 to 5 are inter-connected and relate to the primary issue of disallowance of set-off of losses of Permanent Establishment (PE) with the Royalty and FTS earned by the Head Office (HO). On perusal of assessment order and submission made by the appellant, following

Sunku Satyanarayan Sanajy, Bangalore vs. Deputy Commissioner of Income Tax, Circle-2(2)(1), Bangalore

In the result, the appeal filed by the assessee is allowed for statistical purposes

ITA 1495/BANG/2024[2018-19]Status: DisposedITAT Bangalore15 Jan 2025AY 2018-19

Bench: Shri Prashant Maharishi & Shri Soundararajan K.Assessment Year: 2018-19

For Appellant: Shri Sandeep Chalapathy, CAFor Respondent: Shri Amrit Raj Singh, Addl.CIT (DR)
Section 143(3)Section 195Section 201(1)Section 40

rejected the contention of the assessee that income earned by Tavelon LLC, USA is business profit, therefore in the absence of a Permanent Establishment [PE] in India, same is chargeable to tax only in the country of residence i.e. USA. Therefore the action of Page ... appellate order page nos. 3 to 10. It was further claimed that Tavelon LLC does not have any permanent establishment in India as the services rendered by Tavelon LLC are considered to be business services, those are to be chargeable to tax in US. He further submitted that the services

Murex Southeast Asia Private Limited, Mumbai vs. Deputy Commissioner of Income Tax (Int Taxation) 3(2)(2), Mumbai

In the result, both the appeals are partly allowed in the

ITA 4630/MUM/2023[2021-22]Status: DisposedITAT Mumbai13 Jan 2025AY 2021-22

Bench: Shri Saktijit Dey, V.P. & Ms. Padmavathy S, A.M.

Section 9(1)(vii)

migration of software Rs.16,93,17,904/- Whereas, assessee has claimed exemption in respect of these income stating that in absence of a permanent establishment (PE), the receipts in the nature of business income cannot be taxed. As far as receipts of Rs.10,80,65,944/- from sublicensing of software ... provided by MSEA to Indian customers during the year under consideration. The Comрапу also submits that it is a non- resident with no presence / Permanent Establishment in terms of India-Singapore DTAA in India and there is no maintenance team of the Company in India. efforts to Resolve an Error

Murex Southeast Asia Pvt Ltd, Singapore vs. Deputy Comm. of Income Tax (Int Taxation) 3(2)(2), Mumbai

In the result, both the appeals are partly allowed in the terms indicated above

ITA 2417/MUM/2022[2019-20]Status: DisposedITAT Mumbai13 Jan 2025AY 2019-20

Bench: Shri Saktijit Dey, V.P. & Ms. Padmavathy S, A.M. A.Y. 2019-20 A.Y. 2021-22 Murex Southeast Asia Pvt. Ltd. Deputy Commissioner Of # 19-01, 10 Marina Boulevard, Income Tax Marina Bay Financial Centre, International Tax Vs. Tower 2, Singapore 018983 3(2)(2), Mumbai, Case Of Address 16Th Floor, Air India 503, Avior, Nrimal Galaxy, Building, Nariman Point, Opp Johnson & Johnson, Lbs Mumbai 400021 Marg Mulund West, Mumbai 400080 (Appellant) (Respondent) Pan Aaicm 4006F Assessee By Shri Ajit Jain/Ms. Mitali Pakle & Ms. Shreya Sejpal Revenue By Shri Krishna Kumar, Sr. Dr Date Of Hearing 18.12.2024 Date Of Pronouncement 13.01.2025

Section 9(1)(vii)

migration of software Rs.16,93,17,904/- Whereas, assessee has claimed exemption in respect of these income stating that in absence of a permanent establishment (PE), the receipts in the nature of business income cannot be taxed. As far as receipts of Rs.10,80,65,944/- from sublicensing of software ... during the year under identified by consideration. The Company SUBLICENSEE also submits that it is a non- during the resident with no presence / applicable Permanent Establishment in Maintenance Term, terms of India-Singapore DTAA i.e., to identify and in India and there is no reproduce the Error maintenance team

Lion Services Ltd., Delhi vs. Addl JCIT, Ludhiyana

In the result, impugned assessment order is set aside and appeal of the assessee is allowed for statistical purpose

ITA 1711/DEL/2024[2019-20]Status: DisposedITAT Delhi13 Jan 2025AY 2019-20

Bench: Shri Vikas Awasthy & Shri Avdhesh Kumar Mishraआअसं.1711 To 1715/िद"ी/2025(िन.व. 2011-12, 2013-14 To 2015-16 और 2022-23)

For Appellant: Shri Deepak Chopra & Ms. Priyan TandonFor Respondent: Shri Nikhil Kumar Govila, CIT(DR)

denovo after examining the relevant contracts and other material available on record. The Tribunal further directed to decide the issue relating to existence of Permanent Establishment (PE) in India on the basis of documents relevant to decide the issue in impugned assessment year rather than simply relying on assessment orders

Indian Bank, Chennai vs. DCIT Corp Circle 1(1)

In the result, the appeal filed by the assessee is partly allowed for

ITA 581/CHNY/2024[2020-21]Status: DisposedITAT Chennai08 Jan 2025AY 2020-21

Bench: Shri Aby T. Varkey & Shri Amitabh Shukla

For Appellant: Shri Sanjeev Aditya, C.AFor Respondent: Shri N. Balakrishnan, CIT
Section 143(2)Section 90

profits of Indian Bank foreign branches may be taxable in Singapore and Sri Lanka, but should be restricted to the profits attributable to the permanent establishments in those countries. In this context, the AO noted that the Central Office in India exercised control and management over the foreign branches. According ... Contracting State shall be taxable only in that State unless the enterprise carries on business in the other Contracting State through a permanent establishment (PE) situated therein. And if the enterprise carries on business as aforesaid, the profits of the enterprise may be taxed in the other State but only

Assistant Commissioner of Income Tax Corporate Circle 1 1, Chennai vs. Indian Bank, Chennai

In the result, the appeal filed by the assessee is partly allowed for

ITA 1527/CHNY/2024[2020-21]Status: DisposedITAT Chennai08 Jan 2025AY 2020-21

Bench: Shri Aby T. Varkey & Shri Amitabh Shukla

For Appellant: Shri Sanjeev Aditya, C.AFor Respondent: Shri N. Balakrishnan, CIT
Section 143(2)Section 90

profits of Indian Bank foreign branches may be taxable in Singapore and Sri Lanka, but should be restricted to the profits attributable to the permanent establishments in those countries. In this context, the AO noted that the Central Office in India exercised control and management over the foreign branches. According ... Contracting State shall be taxable only in that State unless the enterprise carries on business in the other Contracting State through a permanent establishment (PE) situated therein. And if the enterprise carries on business as aforesaid, the profits of the enterprise may be taxed in the other State but only

International Air Transport Association (Canada), Mumbai vs. ACIT (It), Range 2 (2)(1), Mumbai

Accordingly Ground No. 3 to 7 are allowed

ITA 7117/MUM/2019[2016-17]Status: DisposedITAT Mumbai08 Jan 2025AY 2016-17

Bench: Shri Saktijit Dey & Ms Padmavathy S, Am

For Appellant: Shri Porus Kaka, Shri DiveshFor Respondent: Shri Krishna Kumar, Sr. DR
Section 143(3)Section 234A

that of wholly devoted as an agent of the assessee. The ld AR argued that the ATCs could not be held as Dependant Agent Permanent Establishment (DAPE) of the assessee as per Article 5(5) of the India-Canada tax treaty. The ld AR further argued that conditions ... India-Canada tax treat, which reads as under: “5. An enterprise of a Contracting State shall not be deemed to have a permanent establishment in the other Contracting State merely because it carries on business in that other State through a broker, general commission agent, or any other agent

International Air Association (Canada), Mumbai vs. Asst CIT (International Taxation) Range 2 (2)(1), Mumbai

Accordingly Ground No. 3 to 7 are allowed

ITA 7072/MUM/2019[2011-12]Status: DisposedITAT Mumbai08 Jan 2025AY 2011-12

Bench: Shri Saktijit Dey & Ms Padmavathy S, Am

For Appellant: Shri Porus Kaka, Shri DiveshFor Respondent: Shri Krishna Kumar, Sr. DR
Section 143(3)Section 234A

that of wholly devoted as an agent of the assessee. The ld AR argued that the ATCs could not be held as Dependant Agent Permanent Establishment (DAPE) of the assessee as per Article 5(5) of the India-Canada tax treaty. The ld AR further argued that conditions ... India-Canada tax treat, which reads as under: “5. An enterprise of a Contracting State shall not be deemed to have a permanent establishment in the other Contracting State merely because it carries on business in that other State through a broker, general commission agent, or any other agent

Internatinal Air Transport Association (Canada), Mumbai vs. DCIT (It) 2(2)(1), Mumbai

Accordingly Ground No. 3 to 7 are allowed

ITA 7416/MUM/2017[2014-15]Status: DisposedITAT Mumbai08 Jan 2025AY 2014-15

Bench: Shri Saktijit Dey & Ms Padmavathy S, Am

For Appellant: Shri Porus Kaka, Shri DiveshFor Respondent: Shri Krishna Kumar, Sr. DR
Section 143(3)Section 234A

that of wholly devoted as an agent of the assessee. The ld AR argued that the ATCs could not be held as Dependant Agent Permanent Establishment (DAPE) of the assessee as per Article 5(5) of the India-Canada tax treaty. The ld AR further argued that conditions ... India-Canada tax treat, which reads as under: “5. An enterprise of a Contracting State shall not be deemed to have a permanent establishment in the other Contracting State merely because it carries on business in that other State through a broker, general commission agent, or any other agent

Shell International Petroeum Company Limited, Mumbai vs. Asst. Commissioner of Income Tax(International Taxation)-4(2)(1), Mumbai

Appeal of the assessee is allowed

ITA 2059/MUM/2016[2011-12]Status: DisposedITAT Mumbai07 Jan 2025AY 2011-12

Bench: Shri Saktijit Dey & Ms Padmavathy S, Am

For Respondent: Shri Vivek Perampurna, CIT-DR
Section 143(3)Section 2(24)Section 234ASection 234BSection 271(1)(c)

that the payment received by SIPCL is chargeable to tax in India and the declaration provided by SIPCL that it does not have a Permanent Establishment (PE) in India in terms of Article M/s Shell International Petroleum Company Ltd. 5 of DTAC, we rule that the applicant is under obligation ... reached an erroneous conclusion that the services availed are technical services. 25. Moreover, the AAR has not dealt with the issue relating to the 'Permanent Establishment' of SIPCL and there is no determination on the same. Of course, that was not a subject of reference before AAR. 26. Thus

Hakam Fluid Power Pvt. Ltd., New Delhi vs. ITO Ward 11(1), New Delhi

In the result, appeal of the assessee is allowed

ITA 756/DEL/2024[2017-18]Status: DisposedITAT Delhi06 Jan 2025AY 2017-18

Bench: Sh. Satbeer Singh Godara (Judicial Member)

Section 143(2)Section 143(3)Section 144C(13)Section 44DSection 9(1)(vii)

received during the year from engineering and procurement support services provided to RIL which is not taxable in India as it has no Permanent Establishment (PE) in India. However, the AO was of the view that as per section 9(1)(vii) of the Act, consideration received ... That on the facts and circumstances of the case and in law, the DRP has erred in holding that the Appellant had a Permanent Establishment in India. 5. That on the facts and circumstances of the case and in law, the Ld. AO has cred in proposing

Sms Concast Ag, New Delhi vs. ACIT, (International Taxation), Circle- 3(1)(2), New Delhi

In the result, all the three appeals of AYs 2015-16, 2016-17 & 2017-18

ITA 2695/DEL/2018[2014-15]Status: DisposedITAT Delhi06 Jan 2025AY 2014-15

Bench: Shri Saktijit Dey & Shri S.Rifaur Rahmanddit, Circle 2 (2), Vs. Sms Siemag Ag, New Delhi. C/O Mohinder Puri & Co., 1A-1D, Vandhna, 11, Tolstoy Marg, New Delhi – 110 01. (Aadcs1173J) Sms Siemag Ag, Vs. Ddit, Circle 2 (2), C/O Mohinder Puri & Co., New Delhi. 1A-1D, Vandhna, 11, Tolstoy Marg, New Delhi – 110 01. (Aadcs1173J)

For Appellant: Shri Percy Pardiwalla, Sr. AdvocateFor Respondent: Shri Vijay B Vasanta, CIT DR
Section 142(1)Section 143(1)Section 148

while making the impugned addition, as the Ld. CIT(A) grossly erred holding that supervisory activities rendered for the project NINL does not constitute Permanent Establishment ('PE') in India in terms of Article 5(2)(1) of the DTAA; 4.3. That while making the impugned addition ... rejecting the claim of the appellant to treat the proceeds towards such supervisory services as non-taxable business profits in the absence of Permanent Establishment ("PE") in India for relevant contracts in terms of Article 7 of the DTAA; ITA No.3071/DEL/2019 ITA No.1443 & 1444/DEL/2022 6. That impugned order

Ge Nuovo Pignone Spa, Gurgaon vs. DCIT (International Taxation), Circle-1(3)(1), New Delhi

In the result, the appeal of the assessee is partly allowed as above

ITA 6893/DEL/2017[2010-11]Status: DisposedITAT Delhi03 Jan 2025AY 2010-11

Bench: Shri Vikas Awasthy & Shri Avdhesh Kumar Mishra

Section 147Section 148Section 234BSection 44D

survey, it was held in the assessments of AYs 2001-02 to 2008-09 that the assessee was having business connection as well as Permanent Establishment (hereinafter, the ‘PE’) in India; hence, its income was taxable in India. Therefore, the AO taxed 35% of total business profit pertaining to marketing

Janet Christine Depenning, Chennai vs. ITO, International Taxation Ward-1(1), Chennai

In the result, the appeal of the Revenue is allowed for statistical purpose

ITA 1319/CHNY/2024[2014-15]Status: DisposedITAT Chennai31 Dec 2024AY 2014-15

Bench: Shri Aby T. Varkey & Shri Jagadishआयकर अपील सं./Ita Nos.1319, 1320, 1321, 1322 & 1323/Chny/2024 िनधा<रण वष< /Assessment Years:2014-15, 2015-16, 2016-17, 2017-18 & 2020-21 Janet Christine Depenning, The Income Tax Officer, 120, Velachery Main Road, Vs. International Taxation Ward-1(1), Guindy,Chennai – 600 032. Chennai. [Pan: Aebpd 2408L]

For Appellant: Shri Sanjeev Aditya, C.A LMFor Respondent: Smt. G. Saratha, Addl. CIT
Section 195Section 201(1)Section 9(1)(vii)Section 9(1)(viii)

considered as a independent personal service/business profit as per the DTAA which do not warrant a tax deduction at source if the Permanent establishment of the payee is not in India 2. Period of limitation That on facts, the learned CIT(A) erred in upholding the decision of the Income ... attorneys in foreign countries are to be considered as independent personal services/business and do not warrant a tax deduction at source if the permanent establishment of ITA Nos.1319 to 1323/Chny/2024 :- 4 -: the payee is not in India. The Ld. AR submitted that the Ld AO though observed that relevant DTAA

ACIT, Non-Corporate Cirle-8, Chennai vs. Indian Overseas Bank, Chennai

ITA 254/CHNY/2023[2017-18]Status: DisposedITAT Chennai31 Dec 2024AY 2017-18
For Appellant: Shri. C. Naresh, C.AFor Respondent: Shri. A. Sasikumar, IRS. CIT
Section 115JSection 143(2)Section 143(3)Section 14ASection 14A(2)Section 250Section 36(1)(vii)Section 36(1)(viia)

IN THE INCOME TAX APPELLATE TRIBUNAL 'D' BENCH, CHENNAI BEFORE HON'BLE SHRI MANOJ KUMAR AGGARWAL, ACCOUNTANT MEMBER AND HON

ACIT, Non-Corporate Cirle-8, Chennai vs. Indian Overseas Bank, Chennai

ITA 253/CHNY/2023[2016-17]Status: DisposedITAT Chennai31 Dec 2024AY 2016-17
Section 115JSection 143(2)Section 14ASection 14A(2)Section 250Section 36(1)(vii)Section 36(1)(viia)

2 ITA Nos .661 & 914/19, 202,203/23 others others years 2015-16, 2016-2017 and 2017-2018 respectively against different

Indian Overseas Bank, Chennai vs. DCIT, Ltu(2), Chennai

Accordingly, this ground of Revenue is dismissed

ITA 203/CHNY/2023[2017-18]Status: DisposedITAT Chennai31 Dec 2024AY 2017-18

Bench: Hon’Ble Shri Manoj Kumar Aggarwal & Hon’Ble Shri Manu Kumar Giriआयकरअपील सं./ Ita Nos.661/Chny/2019, 202 & 203/Chny/2023 (िनधा"रणवष" / Assessment Years: 2015-16, 2016-17 & 2017-2018) Indian Overseas Bank, Vs. The Assistant Commissioner Of 763, Anna Salai, Income Tax, Chennai 600 002. Ltu (2) Chennai. आयकरअपील सं./ Ita Nos.914/Chny/2019, 253 & 254/Chny/2023 (िनधा"रणवष" / Assessment Years: 2015-16, 2016-17&2017-2018) The Assistant Commissioner Of Vs. Indian Overseas Bank, Income Tax, 763, Anna Salai, Ltu (2) Chennai 600 002. Chennai. [Pan: Aaaci 1223J] (अपीलाथ"/Appellant) (""यथ"/Respondent) Assessee By : Shri. C. Naresh, C.A., Department By : Shri. A. Sasikumar, Irs. Cit. सुनवाई क" तार"ख/Date Of Hearing : 14.11.2024 घोषणा क" तार"ख /Date Of Pronouncement : 31.12.2024

For Appellant: Shri. C. Naresh, C.AFor Respondent: Shri. A. Sasikumar, IRS. CIT
Section 115JSection 143(2)Section 14ASection 14A(2)Section 250Section 36(1)(vii)Section 36(1)(viia)

observing that contrary to the facts of this case, Shri Chéttiar was fiscally domiciled in Malaysia and did not have any permanent establishment in India. On DTM with south Korea, the Assessing Officer was of the view that the terms contained therein did not give exclusive rate