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“agency PE”

International TaxDTAA Article 5DTAA Article 5218 judgments

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

Leading authorities on agency 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.

Set Satellite Pte Ltd. v. CIT
307 ITR 205 · 2008 · High Court
96
citing judgments

If a Dependent Agency Permanent Establishment (DAPE) is remunerated at arm's length based on transfer pricing principles, no further profits can be attributed to the foreign enterprise. The principles of profit attribution under DTAA Article 7 are pari-materia to Section 9(1)(i) of the Income Tax Act.

National Petroleum Construction Company v. DIT
383 ITR 648 · 2016 · High Court
69
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.

Delmas France v. Asstt. DIT (IT)
17 Taxmann.com 91 · 2012 · ITAT
49
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.

Trib.) 4) TVM Limited v. Commissioner of Income-tax
237 ITR 230 · 1999 · Reported
47
citing judgments

A non-resident entity's activities in India are assessed for Permanent Establishment (PE) under Double Taxation Avoidance Agreements, considering types like fixed place, construction, and agency PE, and the applicability of presumptive taxation under sections such as 44BBB.

4) DIT v. B4U International
374 ITR 453 · 2015 · High Court
39
citing judgments

An agent is considered independent for the purposes of Article 5(5) of the India-Mauritius treaty if the agent works for more than one principal, regardless of whether the principal has only one agent in India. The focus is on the agent's independence, not the principal's exclusive use of an agent.

Co. Ltd. v. DDIT(IT)
55 Taxmann.com 520 · 2015 · ITAT
36
citing judgments

A foreign company engaged in the reinsurance business is not considered to have a fixed permanent establishment or an agency permanent establishment in India through its Indian subsidiary, provided specific conditions under Article 5 of the relevant Double Taxation Avoidance Agreement are not met.

Western Union Financial Services Inc. v. ADIT
104 ITD 34 · 2007 · ITAT
26
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 agency PE

Travelport Global Distribution System Bv, Netherlands vs. DCIT, Circle- 3(1)(1), International Taxation, New Delhi

In the result, all the appeals of the assessee and CO are allowed and the appeal of the revenue is dismissed

ITA 6515/DEL/2017[2014-15]Status: DisposedITAT Delhi13 Oct 2021AY 2014-15

Bench: Sh. Kul Bharatdr. B. R. R. Kumar(Through Video Conferencing) Ita No. 5601/Del/2010 : Asstt. Year : 2007-08 Travelport Global Distribution System Bv Vs Asstt. Director Of Income (Earlier Known As Galileo Nederland Bv) Tax, Circle-1(2), Bsr & Co., Dlf Building No. 10, 8Th Floor, New Delhi Tower-B, Dlf Cyber City, Phase-Ii, Gurgaon-122002 (Appellant) (Respondent) Pan No. Aaccg2258D

Delhi ITAT vide its dated 30 Nov. 2007 (19 SOT 257 (DELHI) held that GII has a fixed place PE and Agency PE in form of the Interglobe in India. (Page 194 to 251 of Paperbook Part 1.) The relevant extracts from this order are re-produced as under

Galileo Nederland Bv, Gurgaon vs. DCIT (International Taxation), New Delhi

In the result, all the appeals of the assessee and CO are allowed and the appeal of the revenue is dismissed

ITA 3034/DEL/2016[2010-11]Status: DisposedITAT Delhi13 Oct 2021AY 2010-11

Bench: Sh. Kul Bharatdr. B. R. R. Kumar(Through Video Conferencing) Ita No. 5601/Del/2010 : Asstt. Year : 2007-08 Travelport Global Distribution System Bv Vs Asstt. Director Of Income (Earlier Known As Galileo Nederland Bv) Tax, Circle-1(2), Bsr & Co., Dlf Building No. 10, 8Th Floor, New Delhi Tower-B, Dlf Cyber City, Phase-Ii, Gurgaon-122002 (Appellant) (Respondent) Pan No. Aaccg2258D

Delhi ITAT vide its dated 30 Nov. 2007 (19 SOT 257 (DELHI) held that GII has a fixed place PE and Agency PE in form of the Interglobe in India. (Page 194 to 251 of Paperbook Part 1.) The relevant extracts from this order are re-produced as under

Galileo Nederland Bv, Gurgaon vs. DCIT (International Taxation), New Delhi

In the result, all the appeals of the assessee and CO are allowed and the appeal of the revenue is dismissed

ITA 3033/DEL/2016[2009-10]Status: DisposedITAT Delhi13 Oct 2021AY 2009-10

Bench: Sh. Kul Bharatdr. B. R. R. Kumar(Through Video Conferencing) Ita No. 5601/Del/2010 : Asstt. Year : 2007-08 Travelport Global Distribution System Bv Vs Asstt. Director Of Income (Earlier Known As Galileo Nederland Bv) Tax, Circle-1(2), Bsr & Co., Dlf Building No. 10, 8Th Floor, New Delhi Tower-B, Dlf Cyber City, Phase-Ii, Gurgaon-122002 (Appellant) (Respondent) Pan No. Aaccg2258D

Delhi ITAT vide its dated 30 Nov. 2007 (19 SOT 257 (DELHI) held that GII has a fixed place PE and Agency PE in form of the Interglobe in India. (Page 194 to 251 of Paperbook Part 1.) The relevant extracts from this order are re-produced as under

Galileo Nederland Bv, Gurgaon vs. DCIT (International Taxation), New Delhi

In the result, all the appeals of the assessee and CO are allowed and the appeal of the revenue is dismissed

ITA 3032/DEL/2016[2008-09]Status: DisposedITAT Delhi13 Oct 2021AY 2008-09

Bench: Sh. Kul Bharatdr. B. R. R. Kumar(Through Video Conferencing) Ita No. 5601/Del/2010 : Asstt. Year : 2007-08 Travelport Global Distribution System Bv Vs Asstt. Director Of Income (Earlier Known As Galileo Nederland Bv) Tax, Circle-1(2), Bsr & Co., Dlf Building No. 10, 8Th Floor, New Delhi Tower-B, Dlf Cyber City, Phase-Ii, Gurgaon-122002 (Appellant) (Respondent) Pan No. Aaccg2258D

Delhi ITAT vide its dated 30 Nov. 2007 (19 SOT 257 (DELHI) held that GII has a fixed place PE and Agency PE in form of the Interglobe in India. (Page 194 to 251 of Paperbook Part 1.) The relevant extracts from this order are re-produced as under

DCIT (International Taxation), New Delhi vs. M/S Travelport Global Distribution System Bv., Gurgaon

In the result, all the appeals of the assessee and CO are allowed and the appeal of the revenue is dismissed

ITA 6162/DEL/2015[2012-13]Status: DisposedITAT Delhi13 Oct 2021AY 2012-13

Bench: Sh. Kul Bharatdr. B. R. R. Kumar(Through Video Conferencing) Ita No. 5601/Del/2010 : Asstt. Year : 2007-08 Travelport Global Distribution System Bv Vs Asstt. Director Of Income (Earlier Known As Galileo Nederland Bv) Tax, Circle-1(2), Bsr & Co., Dlf Building No. 10, 8Th Floor, New Delhi Tower-B, Dlf Cyber City, Phase-Ii, Gurgaon-122002 (Appellant) (Respondent) Pan No. Aaccg2258D

Delhi ITAT vide its dated 30 Nov. 2007 (19 SOT 257 (DELHI) held that GII has a fixed place PE and Agency PE in form of the Interglobe in India. (Page 194 to 251 of Paperbook Part 1.) The relevant extracts from this order are re-produced as under

Travelport Global Distribution System Bv, Nederland vs. DCIT, New Delhi

In the result, all the appeals of the assessee and CO are allowed and the appeal of the revenue is dismissed

ITA 2101/DEL/2015[2011-12]Status: DisposedITAT Delhi13 Oct 2021AY 2011-12

Bench: Sh. Kul Bharatdr. B. R. R. Kumar(Through Video Conferencing) Ita No. 5601/Del/2010 : Asstt. Year : 2007-08 Travelport Global Distribution System Bv Vs Asstt. Director Of Income (Earlier Known As Galileo Nederland Bv) Tax, Circle-1(2), Bsr & Co., Dlf Building No. 10, 8Th Floor, New Delhi Tower-B, Dlf Cyber City, Phase-Ii, Gurgaon-122002 (Appellant) (Respondent) Pan No. Aaccg2258D

Delhi ITAT vide its dated 30 Nov. 2007 (19 SOT 257 (DELHI) held that GII has a fixed place PE and Agency PE in form of the Interglobe in India. (Page 194 to 251 of Paperbook Part 1.) The relevant extracts from this order are re-produced as under

Aspect Software Inc., Usa vs. DCIT Circle 1(1)((1 )International Taxation), New Delhi

The appeal of the assessee is hereby allowed

ITA 6661/DEL/2019[2016-17]Status: DisposedITAT Delhi24 Sept 2021AY 2016-17

Bench: Sh. Kul Bharatdr. B. R. R. Kumar(Through Video Conferencing)

For Appellant: Ms. Rashmi Chopra, AdvFor Respondent: Sh. Sunil Kumar, CIT DR
Section 115ASection 143(3)

implementation services – Rs.1834,59,663/- d. Professional Services (offered to tax) – Rs.65,51,510/- 6. The AO held that the assessee had an Agency PE in India in the form of Aspect Contact Centre Software India Pvt. Ltd. for the supply of hardware in India and proposed 15% attribution

Amitabh Chaturvedi, New Delhi vs. ACIT, Circle- 63(1), New Delhi

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

ITA 4001/DEL/2017[2013-14]Status: DisposedITAT Delhi21 Sept 2021AY 2013-14

Bench: Shri O.P. Kant & Shri Kuldip Singh[Through Video Conferencing] Assessment Year: 2013-14

Section 143(3)Section 40

DTAA between UK and India. 6.9 In our opinion, under Article 5 of India UK DTAA, PE can be either a fixed place or agency PE or service PE. The relevant Article of DTAA is reproduced as under: “ARTICLE 5 PERMANENT ESTABLISHMENT 1. For the purposes of this Convention ... been carried out from said place. No such finding of fact has been recorded by the lower authorities. Further, no evidence of any agency PE or service PE has been brought on record by the lower authorities. Alternatively, the learned CIT(A) has also confirmed the disallowance in terms

Zte Corporation, Gurgaon vs. DCIT (International Taxation), Gurgaon

ITA 1930/DEL/2020[2017-18]Status: DisposedITAT Delhi30 Jun 2021AY 2017-18
Section 133A

appellate commissioner accepted the assessee's contentions and found as follows: (i) Assessee had fixed place PE and dependent agency PE in India. However, he did not accept the AO's plea as regards installation PE in India. (ii) On the issue of taxation of software embedded in telecom equipment

Zte Corporation, China vs. JCIT (OSD) International Taxation, Gurgaon

ITA 1474/DEL/2020[2016-17]Status: DisposedITAT Delhi30 Jun 2021AY 2016-17
Section 133A

appellate commissioner accepted the assessee's contentions and found as follows: (i) Assessee had fixed place PE and dependent agency PE in India. However, he did not accept the AO's plea as regards installation PE in India. (ii) On the issue of taxation of software embedded in telecom equipment

DCIT, Int. Tax., .Circle Gurgaon, Gurgaon vs. Zte Corporation, China

ITA 8185/DEL/2019[2016-17]Status: DisposedITAT Delhi30 Jun 2021AY 2016-17
Section 133A

appellate commissioner accepted the assessee's contentions and found as follows: (i) Assessee had fixed place PE and dependent agency PE in India. However, he did not accept the AO's plea as regards installation PE in India. (ii) On the issue of taxation of software embedded in telecom equipment

Amadeus India Pvt. Ltd., New Delhi vs. ACIT, Circle 2(2), New Delhi

In the result, the appeal of assessee are allowed

ITA 8700/DEL/2019[2015-16]Status: DisposedITAT Delhi31 May 2021AY 2015-16

Bench: Sh. Anil Chaturvedi & Sh. Amit Shukla(Through Video Conferencing) Amadeus India Pvt. Ltd., Vs. Acit E-9, Connaught Hose, Circle – 2(2), Connaught Place, New Delhi New Delhi - 110001 Pan No. Aaaca 0364 L (Appellant) (Respondent) Assessee By Shri Taran Deep Singh, Adv. Revenue By Shri Surender Pal, Cit-D.R. Date Of Hearing: 18/05/2021 Date Of Pronouncement: 31/05/2021 Order Per Anil Chaturvedi, Am: This Appeal Filed By The Assessee Is Directed Against The Order Dated 19.09.2019 Of The Asst. Commissioner Of Income Tax, Circle-2(2), Delhi Under Section 143(3) R.W.S 144C(13) Of The Act Pursuant To The Direction Of Dispute Resolution Panel (Drp) – 1, Delhi For Assessment Year 2015-16. 2. The Relevant Facts As Culled From The Material On Records Are As Under :

Section 143(2)Section 143(3)Section 144CSection 144C(2)Section 144C(5)Section 92BSection 92CSection 92C(3)Section 92F

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘I-1’, NEW DELHI BEFORE SH. ANIL CHATURVEDI, ACCOUNTANT MEMBER AND SH

Amadeus India Pvt. Ltd., New Delhi vs. ACIT, Circle- 2(2), New Delhi

In the result, appeal of the assessee in ITA No

ITA 7376/DEL/2018[2014-15]Status: DisposedITAT Delhi08 Mar 2021AY 2014-15

Bench: Shri N.K. Billaiya & Ms. Suchitra Kamble[A.Y 2014-15]

For Appellant: Shri Tarandeep Singh, AdvFor Respondent: Shri Surender Pal, CIT-DR
Section 143(3)Section 14ASection 92F

1 IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI ‘I-1’ BENCH, NEW DELHI BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER, AND

Amadeus It Group Sa, New Delhi vs. DCIT(International Taxation), Circle-1(1)(1), New Delhi

ITA 7047/DEL/2019[2016-17]Status: DisposedITAT Delhi29 Jan 2021AY 2016-17

Bench: Shri Anil Chaturvedi & Shri Kuldip Singh(Through Video Conference)

For Appellant: Shri Ajay Vohra, Senior AdvocateFor Respondent: Dr. Prabha Kant, CIT DR
Section 143Section 144C(13)

providing the hardware support to travel agents and, therefore, profits from such functions were required to be attributed to the appellant’s dependent agency PE in India. 11. That the DRP/assessing officer erred on facts and in law in disallowing expenditure of Euro 27,577,000 incurred by the appellant ... Spain Tax Treaty and likewise held the taxpayer to 11 ITA No.2007/Del./2017 ITA No.3494/Del./2018 ITA No.7970/Del./2018 ITA No.7047/Del./2019 be dependent agency PE in terms of Para 5(4) of the Indian Spain Tax Treaty. 12. AO computed the profit attributed to PE at Rs.311

Amadeus It Group Sa, New Delhi vs. DCIT(International Taxation), Circle-9(1)(1), New Delhi

ITA 7970/DEL/2018[2015-16]Status: DisposedITAT Delhi29 Jan 2021AY 2015-16

Bench: Shri Anil Chaturvedi & Shri Kuldip Singh(Through Video Conference)

For Appellant: Shri Ajay Vohra, Senior AdvocateFor Respondent: Dr. Prabha Kant, CIT DR
Section 143Section 144C(13)

providing the hardware support to travel agents and, therefore, profits from such functions were required to be attributed to the appellant’s dependent agency PE in India. 11. That the DRP/assessing officer erred on facts and in law in disallowing expenditure of Euro 27,577,000 incurred by the appellant ... Spain Tax Treaty and likewise held the taxpayer to 11 ITA No.2007/Del./2017 ITA No.3494/Del./2018 ITA No.7970/Del./2018 ITA No.7047/Del./2019 be dependent agency PE in terms of Para 5(4) of the Indian Spain Tax Treaty. 12. AO computed the profit attributed to PE at Rs.311

Amadeus It Group Sa, New Delhi vs. DCIT (International Taxation), Circle-1(1)(1), New Delhi

ITA 3494/DEL/2018[2014-15]Status: DisposedITAT Delhi29 Jan 2021AY 2014-15

Bench: Shri Anil Chaturvedi & Shri Kuldip Singh(Through Video Conference)

For Appellant: Shri Ajay Vohra, Senior AdvocateFor Respondent: Dr. Prabha Kant, CIT DR
Section 143Section 144C(13)

providing the hardware support to travel agents and, therefore, profits from such functions were required to be attributed to the appellant’s dependent agency PE in India. 11. That the DRP/assessing officer erred on facts and in law in disallowing expenditure of Euro 27,577,000 incurred by the appellant ... Spain Tax Treaty and likewise held the taxpayer to 11 ITA No.2007/Del./2017 ITA No.3494/Del./2018 ITA No.7970/Del./2018 ITA No.7047/Del./2019 be dependent agency PE in terms of Para 5(4) of the Indian Spain Tax Treaty. 12. AO computed the profit attributed to PE at Rs.311

Amadeus It Group Sa, New Delhi vs. DCIT (International Taxation), New Delhi

ITA 2007/DEL/2017[2013-14]Status: DisposedITAT Delhi29 Jan 2021AY 2013-14

Bench: Shri Anil Chaturvedi & Shri Kuldip Singh(Through Video Conference)

For Appellant: Shri Ajay Vohra, Senior AdvocateFor Respondent: Dr. Prabha Kant, CIT DR
Section 143Section 144C(13)

providing the hardware support to travel agents and, therefore, profits from such functions were required to be attributed to the appellant’s dependent agency PE in India. 11. That the DRP/assessing officer erred on facts and in law in disallowing expenditure of Euro 27,577,000 incurred by the appellant ... Spain Tax Treaty and likewise held the taxpayer to 11 ITA No.2007/Del./2017 ITA No.3494/Del./2018 ITA No.7970/Del./2018 ITA No.7047/Del./2019 be dependent agency PE in terms of Para 5(4) of the Indian Spain Tax Treaty. 12. AO computed the profit attributed to PE at Rs.311

Director of Income Tax vs. E Funds It Solution

The appeals are disposed of

ITA - 735 / 2011HC Delhi05 Feb 2014

OECD Model. In addition, under Art. 5(5) of the OECD Model, a subsidiary constitutes an agency PE of its parent if the subsidiary has the authority to conclude contracts in the name of its parent and habitually exercises this authority, unless these activities are limited to those referred ... assessees, because the activities of e-funds India were not preparatory or auxiliary in character. This is not the correct legal position. Agency PE under Article 5(4) and (5) of DTAA. 31. Paragraphs 4 and 5 of Article 5 relate to creation of agency PE in the second contracting