All receipt of establishment in India by a non-resident is taxable only if the income is incurred in India as per the DTAA between the countries

Last updated: 29 June 2012

Court :
INCOME TAX APPELLATE TRIBUNAL

Brief :
The learned counsel for the assessee at the very outset submitted that in the immediately preceding assessment years, Assessing Officer has accepted the existence of PE as well as the profit attributable to such PE. Hence, income of the assessee has been assessed as a business income as per Articles 5 & 7 of the DTAA. He placed on record copy of the assessment order dated 6.2.2012 passed under sec. 143(3) in assessment year 2008-09. He pointed out that in the light of this order, the ground Nos. 4 to 6 deserve to be allowed and the income of the assessee deserve to be recomputed. He further contended that learned DRP has not considered objections of the assessee and passed a non-speaking order. The learned counsel for the assessee addressed arguments qua ground No.7 to 10 also. But after looking into the order of DRP, we expressed our opinion that all these issues deserve to be set aside to the file of the learned DRP for re-adjudication of the objections raised by the assessee. Learned DR was unable to support the order of the Learned DRP because it does not disclose any facts or reasons as to why the learned DRP did not find any force in the objections of the assessee.

Citation :
Fraport AG Frankfurt Airport Services Worldwide c/o. Mohinder Puri & Co., CA 1 A-D, Vandhna, 11 Tolstoy Marg, New Delhi. (PAN: AAACF9749E) (Appellant) Vs. Asst. Director of IT, Circle 1(2), New Delhi. (Respondent)