Income of non-resident attributed to its PE in India taxable as business profits; balance income not to be taxed as fee for technical services – ITAT Mumbai

Nippon Keiji Kyokoi Vs ITO (ITAT Mumbai)– Notwithstanding a change in the position by the assessee, the Tribunal has held that the effective connection with the permanent establishment in India has to be determined based on a functional test in the case of  fees for technical services . Furthermore, the Tribunal also upheld that if the services are said to have been effectively connected with the permanent establishment, the income would be taxable only as business profits to the extent of attribution and the balance income would not be l

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