No functions, assets and risks analysis is required before AY 2002-03 for determination of profits attributable to dependent agent permanent establishment; no further attribution if dependent agent paid arm’s length commission

DIT Vs. BBC Worldwise Ltd. (Delhi High Court)- Bombay High Court in Set Satellite (Singapore) Pvt. Ltd. (supra) held that if correct ALP is applied and paid, nothing further would be left to be taxed in the hands of the foreign enterprise. In the said case, Morgan Stanley (supra) as well as Circular No. 23 issued by the CBDT was taken into consideration. The Court was also pleased to record that the commission paid to the agent was 15% services performed by the assessee‘s agent in India was in line with the existing industry standards in India at the prevalent time. Reliance was also placed...