https://www.taxtmi.com/caselaws?id=394887 Treaty protection prevails where liaison offices in India perform only preparatory or auxiliary support functions within the limits of regulatory permission. Under Article 5 of the applicable Double Taxation Avoidance Agreement, a fixed place of business becomes a permanent establishment only if it carries on core business activity, while a place maintained solely for preparatory or auxiliary work is excluded. The liaison offices were confined to support tasks for remittance operations and had no authority to undertake trading or earn commission in India, so they did not constitute a permanent establishment. As the activities were merely ancillary to contracts concluded abroad, the deeming rules on accrual and business connection under the Income-tax Act did not by themselves create Indian tax liability. en-us Fri, 24 Apr 2020 00:00:00 +0530 Mon, 15 Jun 2026 10:39:00 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=394887 Treaty protection prevails where liaison offices in India perform only preparatory or auxiliary support functions within the limits of regulatory permission. Under Article 5 of the applicable Double Taxation Avoidance Agreement, a fixed place of business becomes a permanent establishment only if it carries on core business activity, while a place maintained solely for preparatory or auxiliary work is excluded. The liaison offices were confined to support tasks for remittance operations and had no authority to undertake trading or earn commission in India, so they did not constitute a permanent establishment. As the activities were merely ancillary to contracts concluded abroad, the deeming rules on accrual and business connection under the Income-tax Act did not by themselves create Indian tax liability. Case-Laws Income Tax Fri, 24 Apr 2020 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=394887