2026 (1) TMI 474

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..... Rishab Nangia & Mr. Gibran, Advocates. JUDGMENT DINESH MEHTA, J. (ORAL) 1. Both the Writ Petitions involve common questions of law and facts, hence, they are decided conjointly, however, the facts from writ petition No. 10260/2025 are taken into consideration. 2. The petitioner, a company incorporated in Switzerland in 2015 is engaged in the business of supplying Gas Turbines, spare parts and carries on offshore repair of machines manufactured outside India. The petitioner claims that it does not have any Permanent Establishment (hereinafter referred to as 'PE') in India. 3. According to the petitioner, no Tax at Source can be deducted from the payments made to it, as no income is earned in India but in spite of clear provi....

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....rther argued that the approach of the respondents is erroneous and contrary to the facts and law. 9. Mr. Puneet Rai, learned Senior Standing Counsel for the respondents, on the other hand, submitted that it may be true that the certificates at a lower rate of 1.5 percent were issued to the petitioner in the earlier years but while issuing the impugned certificate dated 16.05.2025, the Assessing Officer has recorded a finding that during the proceedings of AY 2022-23 it was found that the petitioner-assessee has a PE in India. He added that it was only in the wake of such finding that a certificate at a rate higher than 1.5 percent (i.e. at 3.5 percent) was issued to the petitioner. 10. He submitted that ultimately, the grant of certif....

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....undation. 15. The impugned order dated 16.05.2025 for deduction of tax at 3.5 percent is, therefore, quashed and set aside. The respondents are directed to issue a fresh certificate to the petitioner providing deduction of tax at the rate of 1.5 percent. Fresh certificate be issued within a period of 15 days from today. 16. We are conscious of this fact that the order of ITAT can be challenged by way of an appeal under Section 260A of the Act of 1961 before this Court. We are informed that no appeal has been filed so far (maybe because the limitation for filing such appeal is still continuing). 17. While allowing both the writ petitions with the aforesaid observations, we hereby direct the respondents to continue issuing certificat....