Itxa/519/2020 Of Commissioner Of Income Tax (It) - 3 v. M/S. J Ray Mc Dermott Eastern Hemisphere Ltd

IN THE HIGH COURT OF JUDICATURE AT BOMBAYORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO. 519 OF 2020 Commissioner Of Income Tax (IT)-3 .. Appellant v/s. M/s. J. Ray MC DermottEastern Hemisphere Ltd... Respondent … Mr. Suresh Kumar for the appellant.Mr. Jeet Kamdar i/by Mr. Atul K. Jasani for the respondent. … CORAM : DHIRAJ SINGH THAKUR AND KAMAL KHATA, JJ. DATED : 9TH FEBRUARY, 2023. P.C. : .This is an appeal filed under Section 260A of the Income Tax Act,1961 against the order of the Income Tax Appellate Tribunal dated 6th May 2016 for the Assessment Year 2000-01. 2.The following questions of law have been framed for ourconsideration: a) “Whether on the facts and circumstances of the case and inlaw the ITAT is correct in holding that the assessee’s case does not constitute the “PE” as per Article 5(2)(c) of Indo-MauritiusDTAA without appreciating the clear facts detected at the timeof survey u/s. 133A of the I.T. Act, wherein the assessee hascarried out all the business acitivity from the Liaison office?” b) “Whether on the facts and circumstances of the case and inlaw the ITAT is correct in holding that the assessee’s casecannot be covered simultaneously by the Article 5(2)(i) and5(2)(c) of Indo-Mauritius DTAA without appreciating that thePE can be examined under “an office PE” or “project PE?” c) “Whether on the facts and circumstances of the case in lawthe ITAT is correct in holding that the activities detected at theLiaison Office constitute auxiliary and preparatory servicesand not the business activity without appreciating that theentire range of activities from beginning to end are conductedat the Liaison office?” 3.The learned counsel for the respondent states that similarquestions of law in the case of the respondents were framed for theconsideration of this court in Income Tax Appeal No. 1670 of 2017 forthe Assessment Year 1998-99, which appeal was dismissed vide orderdated 8th June 2022. It is stated that by virtue of judgment dated 8th June2022, this Court in the said appeal upheld the view expressed by thetribunal for the Assessment Year 1998-99 holding that the case of therespondent would fall under Article 5(3)(e)(ii) of the Agreement forAvoidable of Double Taxation And Prevention of Fiscal Evasion withMauritius (Indo-Mauritius Treaty). While upholding the tribunal’s order in the said appeal, thetribunal had examined the role of employees namely Mr. Tarkar and 2/3 Mr. Rodrigues and found that they were only concerned with thelogistic and coordination and arranging meetings while two otheremployees were stated to have been looking after communications. Afterconsidering all these documents, the Tribunal found that the concernedplace of business was only for the supply of information havingpreparatory or auxiliary character and therefore, would fall underArticle 5(3)(e)(ii) of the Indo-Mauritius Treaty. The order passed by thetribunal which was subject matter of challenge in appeal No. 1670 of2017 was a common order which also decided similar issues as for theassessment year in question i.e. 2000-01. 4.The decision referred by this Court in Income Tax AppealNo.1670 of 2018 squarely applies in the present case. No substantialquestion of law arises in this appeal and the same is accordinglydismissed. (KAMAL KHATA, J.) (DHIRAJ SINGH THAKUR, J.)