Tribunal held that the facts on record clearly established that the Indian subsidiary was economically dependent on the assessee as it handled the work of installation of telecommunications equipment supplied by the assessee on technical support provided by the assessee. Further, the business of the Indian subsidiary was wholly and exclusively for equipment supplied by the assessee. In fact, the Indian subsidiary came into existence with an intent to aid the business of the assessee in India. The facts on record clearly showed that the Indian subsidiary was not capable of supplying the equipment that it is bidding for. The products to be supplied must cater to the specific requirement of the customer. In fact, the business of the assessee in India was totally dependent on the Indian subsidiary. Moreover, the Indian subsidiary was not capable of supplying the equipment and since the technology know-how and capability was owned by the assessee, the Indian subsidiary could not have bid on its own, which meant that the Indian subsidiary was economically dependent on the assessee. The Indian subsidiary not only constituted a dependent agent permanent establishment of the assessee but also a service permanent establishment within the meaning of article 5 of the Double Taxation Avoidance Agreement between India and China. Tribunal also held that,  the equipment, i.e., the hardware supplied by the assessee contained the software and the software was not separately supplied. Moreover, the buyer was granted a non-exclusive, non-transferable and non-sub-licensable licence to use the software. The buyer was granted no title or ownership rights or interest in the software. There was only one contract for supply of equipment which included hardware and software both and, therefore, the income from supply of the equipment was to be assessed as business income arising from the assessee’s business connection/permanent establishment in India. Therefore, the Assessing Officer was to work out the assessee’s income accordingly.  Tribunal held that the assessment was made on the basis of statement recoded in the course of survey as well as considering the documentary evidence hence the assessment is valid.  (AY. 2009-10 to 2016-17)