This document discusses India's positions on various articles in the OECD and UN Model Tax Conventions regarding double taxation avoidance agreements (DTAAs). It notes that while India's tax treaties are based on a combination of the OECD and UN Models, India favors source-based taxation and interprets certain articles more broadly than the Models to constitute a permanent establishment and attribute greater profits to PEs in India. The document provides examples of Indian court decisions that have supported India's positions on key articles like fixed place PEs, installation and service PEs, agency PEs, and business profits attribution.
Frequently Asked Questions Regarding Delegation of Powers to an Indian Reside...Anil Chawla
This FAQ is intended to help foreign companies or residents to delegate authorities and powers to Indian individuals. It will help foreigners understand the options available as well as the risks and liabilities involved.
Advantage of 100% FDI in Indian Defence ProductionAshish Michael
It is a article written about the expected change in Indian government policy of allowing 100% FDI in defence production. It showcase the comparison how the change will be of benefit and create a WIN-WIN opportunity for both Indian manufacturing and Foreign Companies. It has been written in a fairly simple language so that a layman can also understand.
Frequently Asked Questions Regarding Delegation of Powers to an Indian Reside...Anil Chawla
This FAQ is intended to help foreign companies or residents to delegate authorities and powers to Indian individuals. It will help foreigners understand the options available as well as the risks and liabilities involved.
Advantage of 100% FDI in Indian Defence ProductionAshish Michael
It is a article written about the expected change in Indian government policy of allowing 100% FDI in defence production. It showcase the comparison how the change will be of benefit and create a WIN-WIN opportunity for both Indian manufacturing and Foreign Companies. It has been written in a fairly simple language so that a layman can also understand.
Characterized by the increasing arrival rate of live content, the emergency applications pose a great challenge: how to disseminate large-scale live content to interested users in a scalable and reliable manner. The publish/subscribe (pub/sub) model is widely used for data dissemination because of its capacity of seamlessly expanding the system to massive size.
Characterized by the increasing arrival rate of live content, the emergency applications pose a great challenge: how to disseminate large-scale live content to interested users in a scalable and reliable manner. The publish/subscribe (pub/sub) model is widely used for data dissemination because of its capacity of seamlessly expanding the system to massive size.
Muestra concurso de fotografías y croquis urbanos en el ECA-MendozaBiblioteca Leloir
Eca Mendoza. Concurso sobre Patrimonio Cultural de Mendoza de Fotografía y Croquis urbano. Entrega de Premios. Mi agradecimiento a Maria Fabiana Cacace por comunicarme del concurso de fotografía, a María Laura Tinte directora del Eca Mendoza y al Director de Cultura de la Municipalidad de San Rafael Diego Rodriguez Calegaris. 7 de Octubre de 2016. ACADA Producciones.
Objectives & Agenda :
The Multilateral Instrument (MLI) is the latest development in International taxation which would modify the existing bilateral treaties (DTAAs) and implement measures to prevent Base Erosion Profit Shifting (BEPS) strategies. MLI is a flexible instrument which will modify tax treaties according to a jurisdiction’s policy preferences by providing Alternate provisions, optional provisions and right for reservation. In this webinar, we will analyse the MLI Positions of India and 3 other countries and understand the effect of MLI on the tax treaties between the Countries. The 3 countries considered for analysis in this Webinar are Japan, Singapore and the United Kingdom (UK).
This PPT is mainly on the basics of International Taxation which is confusing for many students and many professionals too nowadays. During this evolving world of multinational culture, International Taxation has gained significant importance of which all the professionals should be aware of.
I have tried to compile the concepts of international taxation in this PPT except the concept of Transfer Pricing which in itself is like a whole book.
I have inserted the core concepts which lead to the emergence of International Taxation in India.
General rules for international factoringM S Siddiqui
Bangladesh may adapt The General Rules for International Factoring (GRIF) and encourage Factors to join the global factors chain can guide and regulate the contract of factoring service to protect the interest of the factoring service recipients.
Report No. 5 of 2012 – Performance Audit of Implementation of Public Private ...Life of A Public Auditor
With the opening of Indian airspace to private and international operators, the existing airport infrastructure in the country proved to be inadequate to cope with the unprecedented growth in traffic and cargo. The Ministry of Civil Aviation (MoCA) in 2006, projected a requirement of an additional RS 40,454 crore to augment and modernize existing airports as also to construct new greenfield airports. The revenue surplus generated by Airports Authority of India (AAI) was found to be grossly inadequate to meet this requirement.
In January 2000, the Cabinet approved the restructuring of airports through the long term leasing route. Later, however, in September 2003, the Cabinet approved the restructuring of Delhi and Mumbai airports through the Joint Venture mode. In pursuance of this decision, after selection of the JV partner, AAI incorporated a subsidiary company viz. M/S Delhi International Airport Pvt. Ltd (DIAL), and subsequently sold 74% of the shares of DIAL to the JV Consortium. On 4 April 2006, in the capacity of the state promoter, AAI signed an Operation Management Development Agreement (OMDA) with DIAL. The AAI handed over IGI airport, Delhi to DIAL on 3 May 2006 on 'as is where is' basis and granted DIAL the exclusive right to undertake functions of operations, maintenance, development, design, construction, modernization, finance and management of the Airport.
On 26 April 2006 Government of India signed another agreement with DIAL viz State Support Agreement (SSA). The agreement laid down conditions and nature of support to be provided by Government of India, along with the mutual responsibilities and obligations between Government and DIAL.
TransPrice Times 15 December 2015 - 12 January 2016Sangesh Sase
Dear Readers,
Please find a link to the first edition of TransPrice Times for the new year 2016.
With the onset of holiday season, we saw some important judgement being pronounced by courts which are summarized in the alert.
Further, a long awaited guidance from the CBDT on the change in the residential status law which included the a global concept of 'Place of Effective Management' ('POEM') is also covered in the alert.
We hope you find this newsletter useful and look forward to your feedback and suggestions. You can write to us at akshaykenkre@transprice.in
Happy Reading!!!
TransPrice Times 15 December 2015 - 12 January 2016Akshay KENKRE
Dear Readers,
Please find a link to the first edition of TransPrice Times for the new year 2016.
With the onset of holiday season, we saw some important judgement being pronounced by courts which are summarized in the alert.
Further, a long awaited guidance from the CBDT on the change in the residential status law which included the a global concept of 'Place of Effective Management' ('POEM') is also covered in the alert.
We hope you find this newsletter useful and look forward to your feedback and suggestions. You can write to us at akshaykenkre@transprice.in
Happy Reading!!!
1. OECD/UN Model controversies and the
Indian DTAAs (Double Taxation Avoidance
Agreements)
Tax Litigation Conference,
The Lalit, New Delhi
Gautam Chopra | Partner
3. OECD Model Tax Convention
• OECD, formed in 1961 - an organization with 30-member countries,
comprising of developed nations such as US, UK, Australia,
Canada, France, Germany etc.;
• India not a member of OECD; granted “Observer” status in 2006,
which permits expressing reservations/comments on the Model Tax
Convention and Commentary;
• OECD Model Tax Convention widely used as template for
negotiation of treaties between countries; widely perceived as
favouring ‘residence based taxation’;
• Though OECD Model commentary is considered to have
“persuasive value” in interpreting tax treaties, Indian courts have,
time and again, placed reliance on OECD Commentary to interpret
treaties concluded by India;
4. UN Model Tax Convention
• To counter-balance the influence of developed countries on tax treaty
policy, UN conducted its First Interregional Training workshop in
International Taxation in 1999;
• UN Committee of Experts on International Cooperation in Tax matters
formed in 2005; has representatives from developing countries as well,
including India;
• UN Model Convention/Commentary issued; based on OECD Model but
also reflecting the voice of developing countries including India;
perceived to be favoring ‘source based taxation’;
• India’s tax treaties are based on a combination of OECD and UN Model-
with emphasis on ‘source based taxation’;
• India has expressed certain reservations on UN Model and
Commentary – stating that in some cases, the UN Model follows OECD
Model too closely!!
6. Article 5(1) & (2): Fixed place PE
Article 5(1) provides a general definition of ‘Fixed place PE’;
Article 5(2) of the OECD/UN Model Convention provides illustrative list
of PEs, e.g.
• an office,
• a place of management;
• a branch;
OECD considers satisfaction of conditions prescribed in para 1 as
necessary for examples in para 2 to constitute PE;
India’s position:
• India considers that the examples in para 2 independently
constitute a PE;
• ICS to constitute PE in ‘certain circumstances’- whether or not on
dry lease or wet lease;
7. Article 5(1) & (2): Fixed place PE
India’s position:
• ‘Website’ may constitute a PE- depending on location of server;
• Geographical coherence not necessary to constitute PE;
Some important decisions:
CIT v BKI/HAM: 15 Taxmann.com 102 (HC)(Uttarakhand)
DIT v efunds Corporation: 42 taxmann.com 50 (HC)(Del.)
DIT v Ericsson AB: 343 ITR 470 (HC)(Del.)
Fugro Engineers B.V.: 26 SOT 78 (ITAT)(Del.)
Galileo International Inc.:19 SOT 257 (ITAT)(Del.)
Seagate Singapore International Headquarters: 189 Taxman
181(AAR);
Airline Rotables v JDIT: 44 SOT 368(ITAT)(Mum.)
8. Article 5(3): Installation & Service PE
• Article 5(3)(a) of UN Model Convention contains Installation PE
clause
• Article 5(3)(b) contains Service PE clause – PE to be constituted if
an enterprise furnishes services for not less than 183 days through
‘employees or other personnel’: no such clause in OECD Model
Convention;
India’s position:
• Installation and Service PE threshold should be 90 days instead of
183 days
• For constituting installation PE, individual projects needs to be
considered together;
• Service PE may be constituted even if services provided from
outside India;
9. Article 5(3): Installation & Service PE
Some important decisions:
DIT v Morgan Stanley : 292 ITR 416 (SC)
DIT v efunds Corporation: 42 taxmann.com 50 (HC)(Del.)
DIT v Tekmark Global Solutions LLC: 38 SOT 7 (ITAT)(Mum.)
Sumitomo Corporation v DCIT: 114 ITD 61(ITAT)(Del.)
Centrica India Offshore (P.) Ltd: 19 taxmann.com 214 (AAR)
10. Article 5(5): Agency PE
Article 5(5) of UN Model Convention provides for constitution of
Agency PE if a dependent agent (i) has authority to conclude
contracts; or (ii) regularly delivers goods from stock maintained in the
other State on behalf of the enterprise.
India’s position:
• Arm’s length remuneration to an agent who constitutes a PE, shall
not imply independence of agent and extinguishment of liability of
the overseas principal;
• PE should also be constituted if a dependent agent habitually
secures orders;
• Mere presence at negotiation meetings should be sufficient to hold
that the agent has authority to conclude contracts;
11. Article 5(5): Agency PE
Some important decisions:
DIT v efunds Corporation: 42 taxmann.com 50 (HC)(Del.)
Galileo International Inc.:19 SOT 257 (ITAT)(Del.)
ebay International AG v DIT: 40 taxmann.com 20 (Mumbai - Trib.)
Delmas, France v. ADIT: 17 taxmann.com 91
SET Satellite v DDIT: 307 ITR 205 (HC)(Bom.)
DIT v BBC Worldwide: 203 Taxman 554(HC)(Del.)
12. Article 7: Business Profits
Article 7 of the OECD Model Convention provides that profits
attributable to activities of the PE shall be taxable in the other State.
The Article is silent on ‘force of attraction clause;
Article 7 of UN Model Convention contains force of attraction clause;
India’s position:
• Profits attributable to PE should include all profits from activities
wherever carried out, similar to activities of the PE;
• Expenses deductible should be computed in accordance with
domestic tax law principles;
• Attribution of profits may be based on apportionment of total profits
of the enterprise to its various functions;
13. Article 7: Business Profits
Some important decisions:
DIT v Clifford Chance: 33 taxmann.com 200 (ITAT Spl Bench-Mum)
ADIT v WNS Global Services (UK) Ltd: 40 taxmann.com 315
(ITAT)(Mum.)
Convergys Customer Management Group Inc. : 34 taxmann.com 24
(ITAT)(Del.)