The assessee-US company is engaged in the business of diamond grading and preparation of diamond dossiers. It was a tax resident of USA and entitled to be taxed in accordance with the provisions of the India-USA Double Taxation Avoidance Agreement (DTAA). The AO held that the diamond grading services were rendered, constituted a Permanent Establishment (PE) of the assessee in India and, to that extent, the assessee’s receipts from the diamond grading services would be taxable in India.\u00a0\u00a0 On appeal the Tribunal held that GIA India Lab is not acting in India on behalf of the assessee-company. Further, GIA India Lab is not having any authority to conclude contracts and has neither concluded any contracts on behalf of the assessee-company nor has it secured any orders for the assessee-company in India. Thus, GIA India Lab cannot be regarded as ‘agency PE’ of the assessee-company in India.\u00a0 Accordingly the finding of the AO is reversed. (AY. 2010 -11)<\/p>\n","protected":false},"excerpt":{"rendered":"
S. 9(1)(i) : Income deemed to accrue or arise in India-Business connection-Subsidiary company neither concluded any contracts on behalf of assessee-US company-It had no such authority nor secured any orders for it in India, it could not be regarded as Agency PE of assessee in India- DTAA -India-USA. [Art. 5(6)]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-9763","post","type-post","status-publish","format-standard","hentry","category-digest"],"acf":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-2xt","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/9763","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=9763"}],"version-history":[{"count":2,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/9763\/revisions"}],"predecessor-version":[{"id":19471,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/9763\/revisions\/19471"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=9763"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=9763"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=9763"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}