Article 5 of India-Ireland DTAA – If the core activity of assuming risk related to reinsurance was undertaken outside India, the non-core activities undertaken by an affiliate in India cannot constitute DAPE.

12. [2025] 176 taxmann.com 409 (Mumbai - Trib.)

RGA International Reinsurance Company Designated Activity Company vs. DCIT (IT)

IT APPEAL NO. 1092 (MUM.) OF 2025

A.Y.: 2022-23 Dated: 25 June 2025

Article 5 of India-Ireland DTAA – If the core activity of assuming risk related to reinsurance was undertaken outside India, the non-core activities undertaken by an affiliate in India cannot constitute DAPE.

FACTS

The Assessee was a tax resident of Ireland. It was engaged in the business of reinsurance services. RGA Services India Pvt Ltd (“RGA India”) was an Indian affiliate entity of the Assessee. The Assessee had entered into business support services with RGA India. During the relevant year, the Assessee earned reinsurance premium. The Assessee claimed that since it did not have any Permanent Establishment (“PE”) in India, reinsurance premium earned by it was not taxable in India. The AO alleged that the services rendered by RGA India to the Assessee were in the nature of complementary activities, as envisaged under Article 13 of the Multilateral Instruments (“MLI”) and therefore, RGA India constituted Dependent Ag