Once a turnkey project is awarded, a foreign company usually sets up Project Office (PO) in India to undertake project related activities. Sometimes, the only activity to be undertaken by the PO is to act as a communication link between the foreign company and the Indian customer. Therefore, the PO is not involved in any of the core activities. However, Revenue Authorities contend that such a PO constitutes a Permanent Establishment (PE) of a foreign company in India and thereby levy tax by attributing profits to the PE. Recently, the Supreme Court1 had an occasion to examine whether the PO set up for non-core activities constitutes a Fixed Place PE in India.
Source: BDO India
Latest Posts in "India"
- AAR Rules GST Applies to Small Packaged Shrimp Exports, Citing Retail Packaging Criteria
- Supreme Court to Decide if Leasehold Rights Transfer is Taxable Under GST Law
- Only Entity Named as Exporter in Customs Documents Can Claim Service Tax Refund: CESTAT
- CESTAT: Testing Services to Foreign Clients Qualify as ‘Export of Services’ under FTDR Act
- CESTAT Rules Dell India’s Services to Foreign Affiliates Qualify as Export, Allows Appeal
