“dependent agent PE”

International TaxDTAA Article 5DTAA Article 5172 judgments

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

Leading authorities on dependent agent PE

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.

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.

National Petroleum Construction Company v. DIT

383 ITR 648 · 2016 · High Court

citing judgments

An Indian agent providing marketing services, without the authority to conclude contracts on behalf of a foreign company, does not constitute a Dependent Agent Permanent Establishment (DAPE) for the foreign company in India under DTAA provisions.

DIT v. E-Funds IT Solution

364 ITR 256 · 2014 · High Court

citing judgments

A subsidiary is an independent legal entity, and the mere relationship of holding-subsidiary or control by itself does not result in a Permanent Establishment (PE) for the foreign company in India, whether it be a fixed place PE or a dependent agent PE, even when the subsidiary provides outsourced services.

Delmas France v. Asstt. DIT (IT)

17 Taxmann.com 91 · 2012 · ITAT

citing judgments

The ITAT evaluates the profit neutrality theory for a Dependent Agent Permanent Establishment (DAPE), stating that unlike a service PE, a DAPE assumes entrepreneurship risk which must be considered for arm's length remuneration.

DIT v. Galileo International Inc.

224 CTR 251 · High Court

citing judgments

If the income attributable to a Permanent Establishment (PE) in India is less than the remuneration paid to a dependent agent, the assessment is extinguished and no further computation of income is required.

Galileo International Inc. v. DCIT

19 SOT 257 · 2008 · ITAT

citing judgments

A Computer Reservation System (CRS) installed at the premises of Indian subscribers can constitute a Permanent Establishment (PE) in India, and a portion of income from Indian operations may be taxable in India, potentially exhausted by commission paid to Indian distributors.

Western Union Financial Services Inc. v. ADIT

104 ITD 34 · 2007 · ITAT

citing judgments

Software installed in India granting access to an assessee's mainframe located outside India does not constitute a Permanent Establishment (PE) in India. Agents are not considered to have an agency PE if they are not economically dependent on the assessee and lack the authority to conclude contracts.

Judgments citing dependent agent PE

DCIT, Circle- 1(2)(1), International Taxation, New Delhi vs. Convergys Customer Management Group Inc., New Delhi

In the result, assessee’s appeal is partly allowed, whereas,

ITA 7782/DEL/2018[2014-15]Status: DisposedITAT Delhi11 Jan 2023AY 2014-15

Bench: Shri G.S. Pannu, Hon’Ble & Shri Saktijit Deyassessment Year: 2014-15

Section 9(1)(vi)

terms of Article 5 of the DTAA. Proceeding further, he held that the assessee had a fixed place PE, service PE and dependent agent PE. In the aforesaid premises, the Assessing Officer computed profit of Rs.111,49,67,544/- as attributable to the PE in India. Further, the Assessing Officer ... Commissioner (Appeals). While deciding the appeal, learned Commissioner (Appeals) agreed with the submissions of the assessee that the assessee does not have a dependent agent PE and service PE in India. However, he held that the assessee had a fixed place PE in India. With regard to attribution of profit

ACIT, International Taxation, Circle 3(1)(2), New Delhi vs. Sabre Decision Technologies International Llc, Usa

In the result, the appeal of the revenue is dismissed

ITA 7354/DEL/2017[2013-14]Status: DisposedITAT Delhi03 Jan 2023AY 2013-14

Bench: Sh. Saktijit Deydr. B. R. R. Kumar

For Appellant: Sh. Tarandeep Singh, AdvFor Respondent: Sh. Gangadhar Panda, CIT-DR

Section 234ASection 44DSection 9Section 9(1)(vi)

PE in India is made out in the assessee's case as assessee did not have a fixed place of business nor any dependent agent PE (DAPE). 2.4. In regard to existence of PE in India, the AO has brought out in the assessment order (para -2) that in order

Sabre Decision Technologies International Llc, New Delhi vs. ACIT, International Taxation, Circle 3(1)(2), New Delhi

In the result, the appeal of the revenue is dismissed

ITA 5782/DEL/2017[2014-15]Status: DisposedITAT Delhi03 Jan 2023AY 2014-15

Bench: Sh. Saktijit Deydr. B. R. R. Kumar

For Appellant: Sh. Tarandeep Singh, AdvFor Respondent: Sh. Gangadhar Panda, CIT-DR

Section 234ASection 44DSection 9Section 9(1)(vi)

General Electric Company, Mumbai vs. Asst DIT (It) 3(1), Mumbai

In the result, the appeal of the assessee for Assessment Year 2001-02 is allowed and the appeal of revenue for A

ITA 82/MUM/2011[2001-02]Status: DisposedITAT Mumbai23 Dec 2022AY 2001-02

Bench: Shri Aby T Varkey & Shri M Balaganeshm/S. General Electric Company, C/O Kpmg, Lodha Excelus, Apollo Mills Compound, N.M. Joshi Marg, Mahalaxmi, Mumbai-400011 Pan Aaacg5399M …Appellant. Vs. Asst. Director Of Income Tax, (International Taxation)-3(1), Room No.136, 1St Floor, Scindia House, N M Road Ballard Estate, Mumbai-400038. ….Respondent. Dy. Commissioner Of Income Tax, International Taxation-3(1), Mumbai-400 038 ….Appellant. Vs. M/S. General Electric Company, Mahalaxmi, Mumbai. ….Respondent. Assessee By : Shri Percy Pardiwala, Ms. Fereshte Sethna, Shri Mrunal Parekh, Shri Abhishek Tilak & Shri Ameya Pany. Revenue By : Ms. Surabi Sharma, Cit D.R. Shri Sunil Umap, Cit- D.R. Date Of Hearing : 15.12.2022 Date Of Pronouncement : 23.12.2022

For Appellant: Shri Percy PardiwalaFor Respondent: Ms. Surabi Sharma, CIT

Section 139Section 143Section 143(3)Section 147Section 148Section 5Section 9

agent other than an agent of independent status of the non-resident GE group entities. This results into the creation of the dependent agent PE as per the provisions of the tax treaties and business connection as per the provisions of Explanation 2 to Section 9(1)) of the Income ... such non-resident GE group entities and such employees have also participated in the price negotiations. This results into the creation of a dependent agent PE as per the provisions of the tax treaties and business connection as per the provisions of Explanation 2 to Section

DDIT (It) 3(1), Mumbai vs. General Electric Company, Mumbai

In the result, the appeal of the assessee for Assessment Year 2001-02 is allowed and the appeal of revenue for A

ITA 432/MUM/2011[2001-02]Status: DisposedITAT Mumbai23 Dec 2022AY 2001-02

For Appellant: Shri Percy PardiwalaFor Respondent: Ms. Surabi Sharma, CIT

Section 139Section 143Section 143(3)Section 147Section 148Section 5Section 9

M/S. Warner Bros.Distributing Inc., Mumbai vs. ACIT (Intl Tax)-4(3) (2), Mumbai

In the result, appeal of the assessee is allowed pro-tanto

ITA 1721/MUM/2022[2019-20]Status: DisposedITAT Mumbai02 Dec 2022AY 2019-20

Bench: Shri Vikas Awasthy & Shri Gagan Goyalvkvkla- 1721@Eaqcbz@2022 ¼Fu-Oa- 2019&20½ ..... Vihykfkhz/Applicant Warner Bros. Distributing Inc. C/Of The Act Warner Bros. Pictures India Pvt. Ltd. 407, 4Th Floor, Windfall, Sahar Plaza Complex, Andheri Kurla Road, Jb Nagar Andheri East, Mumbai-400 059 Pan No. Aaacw6559R Cuke Vs. ..... Izfroknh/Respondent Assistant Commissioner Of Income Tax Room No.1611, 16Th Floor, Air India Building Nariman Point, Mumbai-400 021

For Respondent: Shri Soumendu Kumar Dash-Sr. DR

Section 144Section 144C(13)Section 5(2)

आयकर अपीलीय अधिकरण eqacbZ ihB ßvk;Þ eaqcbZ Jh fodkl voLFkh] U;kf;d lnL; ,oa Jh xxu xks;y

Rga International Reinsurance Company Designated Activity Company, Mumbai vs. ACIT (It) - RG. 4(1)(1), Mumbai

In the result, the appeal is allowed in the terms indicated above

ITA 6935/MUM/2018[2015-16]Status: DisposedITAT Mumbai31 Oct 2022AY 2015-16

Bench: Us Are As Follows:

Section 115BSection 143(3)Section 234BSection 9(1)(i)

case in law, and based on the directions of the Hon'ble DRP, erred in concluding that RGA Services acts as a Dependent Agent PE of the Appellant in India as per Article 5(6) of the India-Ireland tax treaty. The learned AO erred in holding that

Mfe Formwork Technology Sdn Bhd, Mumbai vs. The CIT (Intl Tax), Mumbai

In the result, the appeal is allowed

ITA 890/MUM/2022[2017-18]Status: DisposedITAT Mumbai30 Aug 2022AY 2017-18

Section 143(3)Section 263

ITA No.: 890 /Mum/2022 Assessment year: 2017-18 Page 1 of 9 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI ‘I

DDIT (I.T) 2(1), Mumbai vs. M/S. Reuters Ltd., Mumbai

In the result, both the appeals filed by the Assessing Officer are dismissed, and both the appeals filed by the assessee are allowed in the limited terms indicated above

ITA 5025/MUM/2004[1999-2000]Status: DisposedITAT Mumbai05 Jul 2022AY 1999-2000

Section 143(3)

ITA No. 4996-4997, 5024-5025/Mum/2004 Assessment years: 1998-99 and 1999-2000 Page 1 of 19 IN THE

DDIT (I.T) 2(1), Mumbai vs. M/S. Reuters Ltd., Mumbai

In the result, both the appeals filed by the Assessing Officer are dismissed, and both the appeals filed by the assessee are allowed in the limited terms indicated above

ITA 5024/MUM/2004[1998-1999]Status: DisposedITAT Mumbai05 Jul 2022AY 1998-1999

Section 143(3)

ITA No. 4996-4997, 5024-5025/Mum/2004 Assessment years: 1998-99 and 1999-2000 Page 1 of 19 IN THE

Refinitiv Ltd., Mumbai vs. DCIT (I.T) 2(1), Mumbai

In the result, both the appeals filed by the Assessing Officer are dismissed, and both the appeals filed by the assessee are allowed in the limited terms indicated above

ITA 4997/MUM/2004[1999-2000]Status: DisposedITAT Mumbai05 Jul 2022AY 1999-2000

Section 143(3)

ITA No. 4996-4997, 5024-5025/Mum/2004 Assessment years: 1998-99 and 1999-2000 Page 1 of 19 IN THE

Refinitiv Ltd., Mumbai vs. DCIT (I.T) RG. 2, Mumbai

In the result, both the appeals filed by the Assessing Officer are dismissed, and both the appeals filed by the assessee are allowed in the limited terms indicated above

ITA 4996/MUM/2004[1998-1999]Status: DisposedITAT Mumbai05 Jul 2022AY 1998-1999

Section 143(3)

ITA No. 4996-4997, 5024-5025/Mum/2004 Assessment years: 1998-99 and 1999-2000 Page 1 of 19 IN THE

ITO, (It)-2(2)(2), Mumbai vs. M/S International Reinsurance and Insurance Consultancy & Broking Services Private Limited, Mumbai

In the result, the appeal filed by the revenue stands dismissed

ITA 2823/MUM/2019[2016-17]Status: DisposedITAT Mumbai13 Jun 2022AY 2016-17

Bench: Shri Amit Shukla, Jm & Shri Amarjit Singh, Am आयकरअपीलसं./ I.T.A. No. 2823/Mum/2019 (निर्धारणवर्ा / Assessment Year: 2016-17) M/S International Ito(It)-2(2)(2), Reinsurance & R. No. 1725, 17Th Floor, Air Insurance Consultancy India Building, Nariman & Broking Services Pvt. Point, बिधम/ Ltd. Mumbai-400 021 Vs. 15Th Floor, B-Wing, Nirmal Building, 241/242, Nariman Point, Mumbai-400 021 स्थायीलेखासं./जीआइआरसं./ Pan No. Aaaci2859J (अपीलाथी/Appellant) (प्रत्यथी / Respondent) : अपीलाथीकीओरसे/ Appellant By : Shri Milind Chavan, Ld. Dr प्रत्यथीकीओरसे/Respondent By : Shri Atul T. Suraiya, Ld. Ar सुनवाईकीतारीख/ : 12.05.2022 Date Of Hearing घोषणाकीतारीख / : 13.06.2022 Date Of Pronouncement आदेश / O R D E R Per Amit Shukla: The Aforesaid Appeal Has Been Filed By The Revenue Against The Impugned Order Dated 28.02.2019 Passed By Ld. Cit (Appeals)-56

For Appellant: Shri Milind Chavan, LdFor Respondent: Shri Atul T. Suraiya, Ld

Section 195Section 201Section 201(1)

Bonfield Asia Pte Ltd. Singapore The assessee was also requested to show cause as to why it should not be considered as a dependent agent PE of M/s. Aon Bonfield Asia Pte Ltd. Singapore, thereby treating all the remittances paid to the said entity as taxable in India. 5. However ... remittance under consideration and no such certificate has been produced. He further held that activities of the assessee makes it as a Dependent agent PE within the provision of Article 5 of the India Singapore DTAA and consequently the profits of M/s. Aon Bonfield Asia Pte Ltd. Singapore shall

Micro Focus Software Inc. (Earlier Known As Novell Inc.), Usa vs. The Dy CIT (Intl. Taxation)-Circle-3(2)(2), Mumbai

In the result, the appeal is allowed in the terms indicated above

ITA 863/MUM/2021[2017-18]Status: DisposedITAT Mumbai30 May 2022AY 2017-18

Section 139(1)Section 143(3)Section 234A

ITA No.863/Mum/2021 Assessment year: 2017-18 Page 1 of 17 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI 'I' BENCH, MUMBAI

Ups Asia Group Pte Ltd., Mumbai vs. Asstt. CIT (International Taxation)-4(3)(1), Mumbai

In the result, appeal by the assessee is allowed in terms of our aforesaid findings

ITA 1220/MUM/2021[2017-18]Status: DisposedITAT Mumbai08 Mar 2022AY 2017-18

Bench: Shri Prashant Maharishi & Shri Sandeep Singh Karhail

For Appellant: Shri Nitesh JoshiFor Respondent: Shri Milind S. Chavan, Sr. AR

Section 143(3)Section 144CSection 144C(13)Section 9(1)(i)

IN THE INCOME TAX APPELLATE TRIBUNAL “I” BENCH, MUMBAI BEFORE SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER AND SHRI SANDEEP SINGH KARHAIL

Travelport International Operations Limited, Berkshire vs. ACIT, Circle-3(1)(1), Int. Tax-3, New Delhi

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

ITA 9711/DEL/2019[2016-17]Status: DisposedITAT Delhi21 Feb 2022AY 2016-17

Bench: Shri N.K. Billaiya & Ms. Astha Chandraasstt. Year: 2016-17

For Appellant: Shri Ajit Kumar Jain, CAFor Respondent: Ms. Anupama Anand, CIT DR

Section 143(3)Section 144C(13)Section 154Section 40Section 40a

Travelport International Operations Limited vs ACIT 3 ■ A fixed place PE in India under Article 5(1) of the DTAA; and ■ A dependent agent PE in India in the form of Interglobe Technology Quotient Private Limited ('1TQPL') under Article 5(5) of the DTAA. 5.1. That on the facts

DCIT, New Delhi vs. M/S. Mitsui & Co., New Delhi

In the result, CO of assessee for A

ITA 5108/DEL/2015[2011-12]Status: DisposedITAT Delhi04 Jan 2022AY 2011-12

Bench: Sh. Anil Chaturvedi & Sh. Kul Bharat

Section 144C(3)Section 44B

detailed reasons stated in the order (which for the sake of brevity are not reproduced) concluded MIPL to be not a dependent agent PE of the AE. The aforesaid decision was followed by the co-ordinate Bench of Tribunal while deciding the appeal ... following the order of the Co-ordinate Bench for earlier years and for similar reasons hold that MIPL to be not a Dependent Agent PE of assessee. Thus the ground of assessee is allowed. 35. Ground No.3 & 4 are w.r.t attribution of 20% profits to the assessee. 36. Before

DCIT, New Delhi vs. M/S. Mitsui & Co., New Delhi

In the result, CO of assessee for A

ITA 5106/DEL/2015[2009-10]Status: DisposedITAT Delhi04 Jan 2022AY 2009-10

Bench: Sh. Anil Chaturvedi & Sh. Kul Bharat

Section 144C(3)Section 44B

Nokia Solutions and Networks Oy., Gurgaon vs. DCIT, International Taxation, Circle-2(2)(2), New Delhi

In the result, all the appeals of the assessee are allowed

ITA 5121/DEL/2019[2015-16]Status: DisposedITAT Delhi07 Dec 2021AY 2015-16

Bench: Sh. Kul Bharatdr. B. R. R. Kumar(Through Video Conferencing) Ita No. 1000/Del/2015 : Asstt. Year : 2010-11 M/S Nokia Solutions & Networks Oy, Vs Addl. Cit, Fi-02610, Karaporti-3, Espoo, International Taxation Finland-2058530-6 Range-2(2) & New Delhi C/O Srbc & Associates, Llp, Golf View, Corporate Tower-B Sector-42, Gurgaon (Appellant) (Respondent) Pan No. Aadcn2300E Ita No. 1116/Del/2017 : Asstt. Year : 2008-09 Ita No. 1117/Del/2017 : Asstt. Year : 2009-10 Ita No. 6704/Del/2017 : Asstt. Year : 2013-14 Ita No. 7419/Del/2018 : Asstt. Year : 2014-15 M/S Nokia Solutions & Networks Oy, Vs Dcit, Fi-02610, Karaporti-3, Espoo, International Taxation Finland-2058530-6 Range-2(2)(2) & New Delhi C/O Srbc & Associates, Llp, Golf View, Corporate Tower-B Sector-42, Gurgaon-122011 (Appellant) (Respondent) Pan No. Aadcn2300E

For Appellant: Sh. Deepak Chopra, AdvFor Respondent: Sh. Sunil Kumar, CIT DR

Section 142(1)Section 143(2)Section 143(3)

which is taxable in the hands of the assessee. 17. In this case the revenue determined the assessee as being a Dependent Agent PE (DAPE). The main observations of the AO are as under: “The Indian AE was involved in Market survey, market research, consumer survey, marketing promotion, after sale

M/S Nokia Solutions and Networks Oy vs. DCIT, International Taxation, New Delhi

In the result, all the appeals of the assessee are allowed

ITA 1117/DEL/2017[2009-10]Status: DisposedITAT Delhi07 Dec 2021AY 2009-10

For Appellant: Sh. Deepak Chopra, AdvFor Respondent: Sh. Sunil Kumar, CIT DR

Section 142(1)Section 143(2)Section 143(3)