IN THE INCOME TAX APPELLATE TRIBUNAL “I” BENCH, MUMBAI BEFORE SHRI SAKTIJIT DEY, VICE PRESIDENT AND SHRI GIRISH AGRAWAL, ACCOUNTANT MEMBER (Assessment Year: 2021-22)

&

ITA No. 1362/Mum/2025 (Assessment Year: 2022-23)

Factive Limited Asst. CIT(IT)-2(3)(1)

C/o. Price Waterhouse & Co. LLP 609, 6^th Floor, Kautilya Bhavan, 252, Veer Savarkar Marg, C-41, C-43, G Block, Vs.

Shivaji Park, Dadar, Bandra Kurla Complex, Mumbai-400 028 Bandra (E), Mumbai PAN/GIR No. AACCF 5745 J (Appellant) : (Respondent)

: Shri Dhanesh Bafna a/w Appellant by Shri Yogesh Malpani &

Ms. Kinjal Patel Respondent by : Shri Krishna Kumar (Sr. DR)

Date of Hearing : 21.08.2025 Date of Pronouncement : 15.09.2025 O R D E R Per Saktijit Dey, Vice President:

Captioned appeals by the assessee are against the final assessment orders passed u/s.

143(3) r.w.s 144C(13) of the Income Tax Act, 1961 (‘the Act’ for short), in pursuance to the directions of learned Dispute Resolution Panel (‘ld. DRP' for short) and pertains to the assessment years (A.Y.) 2021-22 and 2022-23.

2. Since the substantive issue on merits, arising in the appeals are more or less common in both the appeals, we propose to take up ITA No. 4706/Mum/2023, pertaining to A.Y.

2021-22, as the lead appeal.

ITA No. 4706/Mum/2023 (A.Y. 2021-22)

3. Ground nos. 1, 2 & 3 are basically on legal issues, challenging the validity of the final assessment order. At the outset, ld. Counsel appearing for the assessee submitted that he would prefer to address the issues on merits and, if warranted, may press the legal grounds.

4. The learned Departmental Representative ('ld. DR' for short) agreed with the aforesaid suggestion of ld. Counsel for the assessee.

5. In view of the aforesaid, we proceed to deal with the substantive issues on merits as raised in ground nos. 4 to 7, which are as under:

4. On the facts and in the circumstances of the case and in law, the Learned AO and the DRP erred in holding the sum of INR 8,17.59,532 as 'Royalty' under Section 9(1)(vi) of the Act read with Article 13 of the Double Taxation Avoidance Agreement ('the DTAA') entered into between India and UK.

5. On the facts and in the circumstances of the case and in law, the Learned AO and the Learned DRP erred in holding that Dow Jones Consulting India Private Limited (DJCIPL) constitutes a dependent agent Permanent Establishment ('PE') of the Appellant.

6. On the facts and in the circumstances of the case and in law, the Learned DRP erred in invoking the provisions of the Multilateral Instrument ('MLI') and also, holding that the exclusions under Article 5(3) of the DTAA will not apply to the Appellant.

7. Without prejudice to the above, on the facts and in the circumstances of the case and in law, the Learned DRP erred in treating fifty percentage of the turnover as liable to be apportioned to India and determining the profits of the alleged PE at 50% of the turnover apportioned to the alleged PE by invoking Rule 10(1) and Rule 10(iii) of the Income Tax Rules, 1962

6. As could be seen from the grounds raised, basically there are two issues arising for consideration. Firstly, whether the amount received by the assessee from its Associated Enterprises (AE) in India, i.e., Dow Jones Consulting India Private Limited (‘DJCIPL’ for short) is in the nature of royalty, both u/s. 9(1)(vi) of the Act and under Article 13(2) of India United Kingdom (‘UK’ for short) Double Taxation Avoidance Agreement (‘DTAA’

for short). Whereas, the second issue relates to existence or otherwise of a Dependent Agent Permanent Establishment (‘DAPE’ for short) of the assessee in India in the form of DJCIPL. Of-course, the peripheral issues relating to applicability of provisions of Multilateral Instrument (‘MLI’ for short) to Article 5(3) India-UK Treaty and attribution of profit to PE are closely linked to the second issue relating to existence or otherwise of DAPE and would require adjudication only in the event it is held that the assessee, indeed, had a DAPE in India.

7. Be that as it may,