Facts
- Airlines Rotables Ltd. (“assessee”) is a company incorporated under the laws of United Kingdom (“UK”). The assessee is engaged in the business of providing spares and component support for aircraft operators.
- The assessee has entered into an agreement with Jet Airways Limited (“Airline”), for rendering certain support services.
- As per the terms of the agreement,
– When a part! component of the aircraft is not in a condition to be used, the assessee is required to repair and overhaul the component! part. The repair and overhauling of defective part! components is to be done outside India.
– In addition, the assessee is to provide replacement components on exchange basis till the original components are repaired and overhauled.
– To ensure that the replacement for the defective part! components is readily available, a consignment stock of the replacement parts! components is kept at the warehouse of Airline.
– The consignment stock lying in India would remain the property of the assessee at all times.
Issues before the Tribunal
- Whether the assessee had a Permanent Establishment (“PE”) in India on account of maintenance of consignment stock of goods at the warehouse of the Airline.
Ruling of the Tribunal
Fixed Place PE
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