Case Law Details
Director of Income Tax Vs Vs Samsung Heavy Industries Co. Ltd. (Supreme Court)
The issue under consideration is whether the office which is established merely for the sake of communication is covered under the character of Permanent Establishment (PE) under India-Korea DTAA?
Supreme Court states that, there were only two persons working in the Mumbai office, neither of whom was qualified to perform any core activity of the Assessee, the ITAT chose to ignore the same. This being the case, it is clear, therefore, that no permanent establishment has been set up within the meaning of Article 5(1) of the DTAA, as the Mumbai Project Office cannot be said to be a fixed place of business through which the core business of the Assessee was wholly or partly carried on. Also, as correctly argued by Shri Ganesh, the Mumbai Project Office, on the facts of the present case, would fall within Article 5(4)(e) of the DTAA, inasmuch as the office is solely an auxiliary office, meant to act as a liaison office between the Assessee and ONGC. This being the case, it is not necessary to go into any of the other questions that have been argued before us.
Therefore, the appeal is dismissed.
FULL TEXT OF THE SUPREME COURT JUDGEMENT
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