Offshore Supply Not Taxable in the Absence of PE

The Delhi Bench of the Income Tax Appellate Tribunal (ITAT) held that receipts from offshore supply of goods by a UK-based company could not be taxed in India under Section 44BB of the Income-tax Act, 1961, as the Revenue failed to establish the existence of a Permanent Establishment (PE) in India. 

The Tribunal observed that the issue was fully covered by its own decisions in the assessee’s case for earlier assessment years and that no material change in facts had been demonstrated by the Revenue. Consequently, the addition of ₹99.50 crore made on a presumptive basis under Section 44BB was deleted.