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Even if the stated activity(ies) of the liaison office of the respondent in India is regarded as business activity, as noted earlier, the same being "of preparatory or auxiliary character"; by virtue of Art. 5(3)(e) of the DTAA, the fixed place of business (liaison office) of the respondent in India otherwise a PE, is deemed to be expressly excluded from being so. And since by a legal fiction it is deemed not to be a PE of the respondent in India, it is not amenable to tax liability in terms of Art. 7 of the DTAA.

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Sec. 5, 9(1)(i) & 90 of Income-tax Act, 1961— Double taxation relief—UOI vs. U.A.E. EXCHANGE CENTRE.[2020] 24 ITCD Online 032 (SC)