The assessee which is a foreign company incorporated in Israel is engaged in the business of developing software and marketing active content for mobile phones across the globe.  For the year under consideration, the assessee was providing “Live Screen Media technology software solutions” to the telecom operators. The software solutions provided by the assessee allowed telecom operators, advertisers and content providers to send interactive content to mobile phones, which were otherwise not able to access such content. The copyright in the software solutions was at all times owned, developed and maintained by the assessee. The A.O held a conviction that the amount received by the assessee from providing the software solutions to its third party customers in India constituted sale of copyright right, and not sale of a copyrighted article. Accordingly, the A.O concluded that the amount of Rs.16,31,65,734/- that was received by the assessee from the provision of software solutions to the telecom operators in India was towards „royalty‟ both as per the provisions of the I-T Act and the India-Israel tax treaty. Further, the A.O was of the view that M/s Celltick Mobile Media (India) Pvt. Ltd. was the dependant agent PE of the assessee in India. As such, the A.O being of the view that the assessee had generated the revenue from provision of software solutions to its third party customers in India with the joint efforts of its PE in India viz. M/s Celltick Mobile Media (India) Pvt. Ltd., thus, attributed 50% of the total receipts of the assessee to the said Indian PE. Further, in absence of any specific details, the A.O allowed a deduction of 20% towards expenses and assessed the balance receipts of Rs.6,52,66,294/- attributable to the Indian PE as the „business income‟ of the assessee that was liable to be taxed in India.On appeal the Tribunal held that , (i) If the “arms length‟ principle is satisfied qua the relevant transaction between the assessee and its Indian subsidiary, no further profits can be attributed to the assessee in India even if it was to be held that the latter had a PE in India (ii) If the subsidiary has subsequently entered into an “APA‟ with the CBDT & the FAR analysis and overall functions remain unchanged, the “APA‟ would have a bearing on the ALP of the earlier years.  ( ITA No.4167/Mum/2017, dt. 11.06.2019)(AY. 2014-15)