Thursday, January 12, 2012

Onus on AO to show foreign co has a PE in India. Under India-France DTAA, even dependent agent is not PE in absence of finding that transactions are not at ALP

Delmas, France vs. ADIT (ITAT Mumbai)


The assessee, a French company, engaged in the operation of ships in international traffic, claimed that it did not have a PE in India and that no part of its income was chargeable to tax in India. The AO & DRP held that as the assessee had an agent in India which concluded contracts, obtained clearances and did the other work, there was a PE in India under Articles 5(5) & 5(6) of the DTAA. On appeal by the assessee, HELD allowing the appeal:

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Delhi HC holds 10% pre-deposit requirement for penalty-only appeals inapplicable where SCN was issued before amendment

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