TaxTMI 
TaxTMI 
2023 (9) TMI 507
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....rsuance to the directions of learned Dispute Resolution Panel (DRP). 2. In the present appeal, we have been called upon to decide whether the assessee had a Permanent Establishment (PE) either in the nature of a fixed place PE or Supervisory PE under Article 5 of Indian-Japan Double Taxation Avoidance Agreement (DTAA). 3. Before us, learned counsel appearing for the assessee, submitted that the issue is squarely covered in favour of the assessee by the decision of the Tribunal in assessee's own case in assessment years 2014-15, 2015-16 and 2017-18. In this context, she drew our attention to the relevant observations of the Tribunal. 4. Learned Departmental Representative, though, fairly agreed that the issue is covered by the decision of....
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....rial and capital goods sold were effectively connected with the activities of the PE. Accordingly, he concluded that 50% out of the profit earned from the revenue from sale of raw-material and capital goods is attributable to the PE and hence taxable in India. Accordingly, he brought to tax an amount of Rs. 3,05,82,364 in India by treating it as business income applying tax rate of 40%. 6. Against the draft assessment order so passed, the assessee raised objections before learned DRP. Though, learned DRP was conscious of the fact that in assessment years 2014-15 and 2015-16, the Tribunal has decided the issue in favour of the assessee by holding that the revenue earned from supply of raw-material and capital goods are not related to any PE....
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....may exist in India when a foreign enterprise has a Fixed Place in India through which the business of the foreign enterprise is wholly or partly carried out. 12.2 In order to constitute a Fixed Place PE under Article 5(1), the following conditions needs to be satisfied: (i) the existence of a 'place of business', i.e. a facility such as premises; (ii) the place of business must be at the disposal of the enterprise; (iii) this place of business must be 'fixed', i.e. it must be established at a distinct place with a certain degree of permanence; and (iv) the 'carrying on of the business' of the enterprise through this fixed place of business. 12.3 In the present case, FRL is alleged to be the place of business from which the busin....
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....ntention that FRL constitutes Fixed Place PE of the assessee has placed reliance on certain clauses of the License Agreement and argued that title of goods supplied by the assessee to FRL passed in India and hence the assessee is carrying on business in India. In our opinion, reference to these clauses is irrelevant to conclude that the title of goods passed in India and thus Fixed Place PE of the assessee is created in India in view of the judgment of the Hon'ble Supreme Court in Mahabir Commercial Co. Ltd (supra). Since the goods were manufactured outside India, sale of goods took place outside India and consideration was also received by the assessee outside India, title passed outside India and hence the assessee has not carried out any....
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....supplies made by FRL/FCC Clutch to its customers; resolving problems relating to production, fixing of machines, maintenance of machines; checking safety status at the premises and suggesting ways for enhancing safety; support in quality control; IT related services; support for launch of new segment line; etc. In our considered opinion, none of these activities performed by the employees are in the nature of supervisory functions, supervision being the act of overseeing or watching over someone or something which is not reflected in the work done by the engineers in India for FRL. 13.3 Moreover, no installation or assembly project was on going at FRL's premises. FRL is in the existing business since many years and no new line of business....