| COURT: |
|
| CORAM: |
|
| SECTION(S): |
|
| GENRE: |
|
| CATCH WORDS: |
|
| COUNSEL: |
|
| DATE: |
(Date of pronouncement) |
| DATE: |
January 24, 2008 (Date of publication) |
| AY: |
|
| FILE: |
|
| CITATION: |
|
|
|
(i) The Amadeus system, by which subscribers in India are enabled to perform the functions of reservation and ticketing, represents a “business connection” because it extends to the Indian territory in the form of connectivity in India and generates income in India when the booking is completed on the subscribers’ computer;
(ii) In determining the extent of profits attributable to such business connection, one has to look into the factors like functions performed, assets used and risk undertaken. On facts, as the major part of the work was processed at the host computer in Germany, only 15% of the revenue accruing to the assessee in respect of bookings made in India can be said to have accrued or arisen in India;
(iii) In view of Circular No.23 of 23rd July 1969, where the income accruing in India is consumed by the payment made to the agents in India, no income is left to be taxed in India under the Act;
(iv) As the assessee has provided computers and connectivity to its subscribers, it has a ‘fixed place’ PE in India. As the Indian agent has the authority to entry into agreements with the subscribers and installs and configures the computers, and provides connectivity and is functionally and financially dependent on the assessee, there is also a ‘dependent agent’ PE in India;
(v) Only 15% of the revenue generated from the bookings made within India can be said to be attributable to the PE. Since the payment to the agent in India is more than what is the income attributable to the PE in India, it extinguishes the assessment and no further income is taxable in India under the DTAA.
See also Galileo International Inc vs. DDIT (ITAT Delhi) (6.1 MB), SET Satellite (Singapore) Pte Limited 106 ITD 175 & Rolls Royce Plc vs. DDIT
Related Posts:
- Agson Global Pvt. Ltd vs. ACIT (ITAT Delhi) Assessee produced sufficient documentary evidences before the A.O. to prove that money routed from the assessee itself which came back to the assessee in the form of share capital/premium, therefore, assessee proved identity of the Investors, their creditworthiness and genuineness of the transaction in the matter and as such have…
- JDC Traders Pvt. Ltd vs. DCIT (ITAT Delhi) If we accept the argument of the learned DR that u/s 154 of the Act, ld. AO is empowered to deal with the escapement of income in respect of which the reasons were not recorded even after the assessment reopened under section 147 of the Act is completed, it would…
- Sajan Kumar Jain vs. DCIT (ITAT Delhi) In our considered opinion, once a valid return of income was available on record, which was already processed issuing notice u/s 142(1) of the Act asking the assessee to furnish fresh notice in itself is invalid making subsequently proceedings void ab initio.
- Teleperformance Global Services Private Limited vs. ACIT (Bombay High Court) The consequence of approved scheme of amalgamation was that amalgamating company had ceased to exist and on its ceasing to exist, it cannot be regarded as a person against whom assessment proceeding can be initiated. In said case before notice under Section 143(2) of the Act was issued on 26.9.2013,…
- New Delhi Television Ltd vs. DCIT (Supreme Court) In our view the assessee disclosed all the primary facts necessary for assessment of its case to the assessing officer. What the revenue urges is that the assessee did not make a full and true disclosure of certain other facts. We are of the view that the assessee had disclosed…
- DCIT vs. JSW Limited (ITAT Mumbai) In the light of the above discussions, we are of the considered view that rather than taking a pedantic view of the rule requiring pronouncement of orders within 90 days, disregarding the important fact that the entire country was in lockdown, we should compute the period of 90 days by…
[…] Also: Amadeus Global Travel vs. DCIT (ITAT Delhi), Galileo International Inc vs. DDIT (ITAT Delhi) (6.1 MB), & Rolls Royce Plc vs. DDIT. […]