Permanent Establishment under Article 5(2)(c) of the Double Taxation Avoidance Agreement between India and UAE

Last updated: 13 July 2021

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Quick Summary

This Income Tax Appellate Tribunal case concerns whether a construction project undertaken by the National Petroleum Construction Company in India, under the India-UAE Double Taxation Avoidance Agreement (DTAA), constituted a 'permanent establishment'. The revenue argued that the project created such an establishment, making the company liable for tax in India. The Tribunal's decision, detailed in the full judgement, clarifies the application of Article 5(2)(c) of the DTAA to such scenarios.

Court :
ITAT Delhi

Brief :
This appeal filed by the revenue is preferred against the order of the CIT(A)-43, New Delhi dated 06.06.2017 for A.Y. 2011-12.

Citation :
ITA No.5563/Del/2017

IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCH ‘D’, NEW DELHI

BEFORE SH. N. K. BILLAIYA, ACCOUNTANT MEMBER
AND
SH. SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER
(THROUGH VIDEO CONFERENCING)

ITA No.5563/Del/2017
Assessment Year: 2011-12

DCIT Circle – 2 (2) (2),
International Taxation,
New Delhi
(APPELLANT)

National Petroleum
Construction Company
C/o Nangia & Co. LLA,
A-109, Sector -136, Noida
(RESPONDENT)

Appellant by Sh. Amit Arora, CA
Respondent by Dr. Prabha Kant, CIT

Date of hearing: 01/07/2021
Date of Pronouncement: 01/07/2021

ORDER

PER N. K. BILLAIYA, AM:

This appeal filed by the revenue is preferred against the order of the CIT(A)-43, New Delhi dated 06.06.2017 for A.Y. 2011-12.

2. The grievance of the revenue read as under :-

To know more in details find the attachment file

FAQ :

The appeal concerns whether a construction project undertaken by the National Petroleum Construction Company in India created a 'permanent establishment' under Article 5(2)(c) of the Double Taxation Avoidance Agreement (DTAA) between India and the UAE.

The appellant is the DCIT Circle - 2(2) (International Taxation), New Delhi (the revenue), and the respondent is the National Petroleum Construction Company.

Article 5(2)(c) of the Double Taxation Avoidance Agreement (DTAA) between India and the UAE is the key provision being considered in relation to the definition of a permanent establishment.

The assessment year under review in this appeal is 2011-12.