April 2024
Article 5 of India-Singapore DTAA — For computation of duration of Service PE, only time spent in India needs to be considered. Presence in India should not include days during which employees did not render any services to the client such as days of vacation and business development. Further, presence should be computed based on solar days i.e. day on which more than one employee is present in India should be counted as one day.
By Geeta Jani | Dhishat B Mehta | Bhaumik Goda, Chartered Accountants
15 Clifford Chance PTE Ltd. vs. ACIT
[2024] 160 taxmann.com 424 (Delhi - Trib.)
ITA No: 2681 & 3377/Del/2023
A.Ys.: 2020-21 & 2021-22
Date of Order: 14th March, 2024
Article 5 of India-Singapore DTAA — For computation of duration of Service PE, only time spent in India needs to be considered. Presence in India should not include days during which employees did not render any services to the client such as days of vacation and business development. Further, presence should be computed based on solar days i.e. day on which more than one employee is present in India should be counted as one day.
FACTS
Assessee, a tax resident of Singapore provided legal services to its clients in India. Part of the services were provided remotely from outside India and some services were rendered by the employee physically present in India. Assessing Officer (AO) held that the assessee had Service PE in India as the duration threshold of 90 days as provided in the DTAA was exceeded. AO also included the duration of services provided from outside India, total presence of em
