GE Steam Power Systems Vs ACIT (Delhi High Court)
The Delhi High Court dealt with a batch of petitions challenging notices issued under Section 148 of the Income Tax Act, 1961 for Assessment Years 2013–14 to 2017–18. The petitioners, non-resident entities forming part of a global power business group, had either filed returns declaring income such as Fees for Technical Services (FTS) taxable in India or, in some cases, claimed no taxable income and did not file returns for certain years.
Read SC Judgment in this case: SC Refuses to Revive Section 148 Reassessment Notices Against GE Group Companies
The reassessment notices were based on reasons recorded by the Assessing Officer (AO), primarily relying on a survey conducted on 06–07 June 2019 at the premises of Indian group entities. The AO formed a belief that the petitioners had a Permanent Establishment (PE) in India in the form of a Dependent Agent PE and Fixed Place PE, and that income attributable to such PE had escaped assessment. The AO also noted that certain supplies were made to Indian entities without deduction of tax at source and were allegedly not declared in India. Statements of employees recorded during the survey were also relied upon to support the existence of a PE.
