Case Law Details
Nagase And Company Ltd. Vs ADIT (ITAT Mumbai)
ITAT Mumbai held that liaison office in India doesn’t constitute permanent establishment (PE) of the assessee in India under the provisions of DTAA.
Facts-
The assessee is a public company incorporated in Japan, which is engaged in the business of import/export as well as domestic sales of dyestuffs, chemicals, plastic, machinery, electronic materials, cosmetics, health foods and medical equipment. In 1974, the assessee opened a liaison office in Mumbai after obtaining necessary approvals from the Reserve Bank of India (RBI).
In terms of the permission of RBI, the liaison office’s activities are confined to the liaison and representative activities and it is not permitted to carry out any business/commercial activities in India. The return of income was accompanied bya statement of computation of taxable income, profit and loss account, balance sheet, receipt and payment account and auditor’s report.
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