Branch which is not PE in respect of the business done out of the supplies made by foreign principal not taxable in India

IN THE INCOME TAX APPELLATE TRIBUNAL,

MUMBAI BENCH “L”, MUMBAI

BEFORE SHRI R.S. SYAL (AM) & SHRI AMIT SHUKLA (JM)

I.T.A. No.5178/Mum/2009

(A.Y. 2005-06)

ADIT (IT)-2(1),

R.No.116, 1st floor, Scindia House,

Ballard Estate, N.M. Road,

Mumbai-400 038.

Appellant

Vs.

M/s. Varian Medical Systems

(India) Pvt. Ltd.,

India Branch Office,

602, Pressman House, Plot

No.70A, Jain Road, Vile Parle (E),

Mumbai-400 099.

PAN: AAACV9418J.

Respondent

Appellant by: Shri Narender Kumar.

Respondent by: Shri P.R.V. Raghavan.

Date of hearing 29-03-2012

Date of pronouncement 02-04-2012

O R D E R

PER R.S. SYAL, AM:

This appeal by the Revenue arises out of the order passed by the CIT(A) on 25-06-2009 in relation to assessment year 2005-06.

2. The only effective ground reads as under :

 “On the facts and in the circumstances of the case and in law, the Ld. CIT(Appeals) erred in holding that the assessee branch is not the PE in respect of the business done out of the supplies made by foreign principal and accordingly, its business profits attributable to PE are not taxable in India.”

3. At the very outset, the ld. counsel for the assessee contended that similar action was taken by the AO for the assessment year 2003-0-4 also, which was reversed in the first appeal. He placed on record a copy of the order passed by the Tribunal on 13-08-2009 in ITA No.4960/Mum/2007 for the assessment year 2003-04 by which the Revenue’s appeal, under similar circumstances, came to be dismissed. A copy of the judgment of the Hon’ble jurisdictional High Court, in the appeal filed by the Revenue against the said order of the Tribunal for the earlier year, was also placed on record by which the Revenue’s appeal has been dismissed. The ld. DR was fair enough to concede that the facts and circumstances of the instant year are similar to those for the assessment year 2003-04. Respectfully following the precedent, we uphold the impugned order on this issue.

4. In the result, the appeal is dismissed.

Order pronounced on the 02nd day of April, 2012.

                                                      Sd/-                                Sd/-

                                         (AMIT SHUKLA)                      (R.S. SYAL)

                                     JUDICIAL MEMBER           ACCOUNTANT MEMBER

Mumbai: 02nd April, 2012.

NG:

Copy to:

1. Department.

2. Assessee.

3. CIT (A)-XXXI,Mumbai.

4. DIT (IT), Mumbai.

5. DR,”L” Bench, Mumbai.

6. Master file.

(TRUE COPY)

BY ORDER,

Asst. Registrar, ITAT, Mumbai.