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| The Tax Publishers2022 TaxPub(DT) 8235 (Del-HC) : (2023) 455 ITR 0157 INCOME TAX ACT, 1961
Section 9(1)(i) Section 90
A plain reading of article 7(1) of India-Finland DTAA would show that the issue of taxability would arise qua the respondent/assessee only if profits accrue to the respondent/assessee, and that too, only to the extent they can be attributed to its PE in India. As assessee recorded a 'global net loss' in the relevant assessment year, therefore, no profit could have possibly been attributed to it, even though assessee had a PE in India.
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Income deemed to accrue or arise in India - PE in India - Attribution of profit - Assessee recorded a 'global net loss' in the relevant assessment year
Assessee was a non-resident based at Finland-AO held that assessee had a permanent establishment in India within the meaning of article 5 of the Indo-Finland DTAA and profits were attributable to PE of assessee. Held: A plain reading of article 7(1) of India-Finland DTAA would show that the issue of taxability would arise qua the respondent/assessee only if profits accrue to the respondent/assessee, and that too, only to the extent they can be attributed to its PE in India. As assessee recorded a 'global net loss' in the relevant assessment year, therefore, no profit could have possibly been attributed to it, even though assessee had a PE in India.
REFERRED :
FAVOUR : In assessee's favour.
A.Y. :
IN THE DELHI HIGH COURT
RAJIV SHAKDHER & TARA VITASTA GANJU, JJ.
CIT v. Nokia Solutions & Networks OY
ITA No. 503/2022
2 December, 2022
Appellant by: Sanjay Kumar, Advocate
Respondent by: Deepak Chopra & Ankul Goyal, Advocates
[Physical Hearing/Hybrid Hearing (as per request)]
Rajiv Shakdher, J. (Oral)
CM Appl.52239/2022
1. Allowed, subject to just exceptions.
CM Appl.52240/2022
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