India Tax Weekly - June 8, 2012

Alstom Transport SA – Authority for Advance Rulings (AAR)

Applicant, a tax resident of France, along with three other companies, entered into a consortium agreement (CA) to execute design, manufacture, supply, installation, testing and commissioning of signaling/ train control and communication systems tendered by Bangalore Metro Rail Corporation Limited (BMRC). In terms of the CA, the consortium members were jointly and severally responsible for the work tendered by BMRC. Applicant approached the AAR for a ruling on whether payments received for the offshore supply of plant and materials, including spare parts, offshore designing and training of operating and maintenance personnel, and offshore services were taxable in India either under the Income-tax Act, 1961 (IT Act) or the India-France DTAA.