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Delhi High Court rejects concept of Virtual Service PE de hors specific clause in DTAA December 4, 2025
Published in: Alerts
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The Delhi High Court in the case of Clifford Chance Pte. Ltd. (“taxpayer”) dismissed Revenue’s appeals against the Tribunal order, holding that in absence of a specific clause in the India-Singapore DTAA, it was not open to the tax authorities to import the concept of Virtual Service Permanent Establishment into the India-Singapore DTAA to bring to tax profits of the non-resident taxpayer in India.
The High Court further held that in computing the number of days spent in India for determining the constitution of Service PE in terms of Article 5(6)(a) of the DTAA, the days on which the employees of the taxpayer were on vacation and the days spent in India on business development shall be excluded. Also, in case of common days spent by employees, the number of days shall be computed on an overall basis and not on the basis of man days spent.
The team from Vaish Associates Advocates, comprising Mr. Aditya Vohra, Mr. Kunal Pandey and Mr. Tanmay Dhakras, Advocates, briefed Mr. Ajay Vohra, Senior Advocate.
For any further information/clarification, please feel free to write to:
Mr. Aditya Vohra at [email protected] and Mr. Kunal Pandey at [email protected].
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