June 2019

Article 12 and Article 5 read with Article 7(3) of the India–Russia DTAA – consideration received by a member of a consortium qualifies as business income; as the income is attributable to the assessee’s PE in India, it is taxable in India

GEETA JANI | DHISHAT B. MEHTA
Chartered Accountants

9

TS-212-ITAT-2019(Del)

PJSC Stroytransgaz vs. DDIT

ITA No. 2842/Del/2010 [A.Y.: 2004-05]

ITA No. 2843/Del/2010 [A.Y.: 2005-06]

ITA No. 6029/Del/2012 [A.Y.: 2006-07]

ITA No. 3821/Del/2010 [A.Y.: 2004-05]

ITA No. 3822/Del/2010 [A.Y.: 2005-06]

A.Y.s: 2004-05 & 2005-06

Dated: 15th April, 2019

 

Article 12 and Article 5 read with Article 7(3) of the India–Russia DTAA – consideration received by a member of a consortium qualifies as business income; as the income is attributable to the assessee’s PE in India, it is taxable in India

 

FACTS

The assessee is a company incorporated in Russia with expertise in implementation of oil and gas industry projects. During the year under consideration, the assessee entered into a consortium with an Indian company to execute certain oil and gas projects for customers in India.

 

As agreed between the parties to the consortium and the customer, the assessee was required to (i) depute specialised manpower in India to undertake project management and execution to the satisfaction of the customers for a specified monthly consideration, and (ii) to prepare the technical bid to be provided to the customer on the basis of its technical expertise and knowhow.<

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