The Supreme Court of India is providing support for foreign companies fighting tax department claims that subsidiaries in the country constitute permanent establishments, with the tax liabilities they bring.
The top court’s dismissal of a tax department petition provides certainty, which “will help MNCs structure their India operations without the constant risk of unnecessary PE allegations by the Indian tax authorities,” said S.R. Patnaik, head of taxation at law firm Cyril Amarchand Mangaldas.
The case involved a 2024 Delhi High Court order that ruled Progress Rail Locomotive Inc., a US company and part of the Caterpillar Group, didn’t have ...