Ebay Singapore Services Private Limited vs. Deputy Commissioner of Income-tax

Parties Involved

Facts Summary

The assessee, eBay Singapore Services Private Limited, is a non-resident company incorporated in Singapore in 2003. It provides e-commerce-related services to its group companies and has been a resident of Singapore, obtaining Tax Residency Certificates (TRC) for the calendar years 2018 and 2019. During the year under consideration, the assessee sold its shares in Flipkart Singapore for a sale consideration of Rs. 7440,79,50,063/-. It filed its return of income declaring Nil income. The case was selected for scrutiny, and the assessment proceedings were initiated by the National e-Assessment Centre. The assessee claimed that the short-term capital gain upon sale of shares of Flipkart Singapore was not taxable in India as per the India-Singapore Double Tax Avoidance Agreement (DTAA). The Assessing Officer (AO) denied the exemption under Article 13(5) of the India-Singapore DTAA and proposed to tax the capital gains arising on the sale of the shares of Flipkart Singapore. The assessee filed objections before the Dispute Resolution Panel (DRP), which upheld the proposed addition. Aggrieved by the final assessment order, the assessee appealed to the Tribunal.…

Legal Issues

• 1. Whether the AO has erred in determining the total income of the Appellant at Rs. 2257,91,95,035 instead of 'Nil' income as declared by the Appellant in its return of income.
• 2. Whether the AO has erred in carrying out assessment proceedings initiated by National e-Assessment Centre by issuance of notice under section 143(2) of the Act, which was without jurisdiction.
• 3. Whether the AO has erred in denying the entitlement of the Appellant to the benefits of the India-Singapore DTAA.
• 4. Whether the AO has erred in holding that the short-term capital gains of Rs. 2257,91,95,035 arising to eBay Singapore on the sale of shares of Flipkart Private Limited, Singapore are taxable in India by denying the benefit under Article 13 of the India-Singapore DTAA.
• 5. Whether the findings of the AO that eBay Singapore should be governed by the India-US DTAA as against the India-Singapore DTAA since the control and management of eBay Singapore was with eBay Inc in the USA; that the control and management of the Appellant was not in Singapore; that the resolution passed by the board of directors of the Appellant on 9 December 2013 was incorrectly read; and that the Appellant had no commercial purpose, are perverse, factually incorrect, contrary to record and ought to be set aside.
• 6. Whether the AO has erred in not considering the additional evidence submitted by the Appellant before the DRP, despite the DRP admitting the evidence after the AO having stated that the AO does not have any objection.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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