The Assessing Officer attributed 15% of receipts as income attributable to the assessee’s PE in India and applied a 40% tax rate, resulting in a withholding tax rate of 6%. On writ, the assessee contended that, in a similar case, the Supreme Court had held that there was no taxable income in India where expenses exceeded the gross revenue attributable to the PE. The Court held that the Assessing Officer must consider expenses in determining the withholding rate. As the computation was based solely on gross revenue without expense allowance, the matter was remanded for fresh consideration. (AY. 2015-16)