Falcon Ltd of Country X is an associated enterprise of Max Inc. of USA. Falcon Ltd. has a branch in India since 2010. It was selling goods to Indian…

Falcon Ltd of Country X is an associated enterprise of Max Inc. of USA. Falcon Ltd. has a branch in India since 2010. It was selling goods to Indian customers by importing from various countries besides sale in India of goods manufactured by it in Country X. The adjusted total income of the Indian branch of Falcon Ltd for the year ended 31st March, 2024 is 80 lakhs. The branch incurred 12 lakhs by way of executive and general administrative expenditure during the financial year 2023-24. The head office has allocated 18 lakhs as the branch's share of head office expenditure including the expenditure of 12 lakhs incurred by the branch. A survey under section 133A of the Act was conducted in its branch premises in January, 2023 and undisclosed assets of 90 lakhs were found. Assessment for the assessment year 2023-24 was completed by making addition of the entire undisclosed asset of 90 lakhs. The assessee preferred appeal before CIT (Appeals) who gave complete relief to the assessee. The Income-tax Department wants to file an appeal before ITAT. T (P) Ltd. an Indian company, a wholly owned subsidiary of Falcon Ltd., paid 50 lakhs to XYZ Inc. of Country M as fee for technical services. Services were rendered by the employees of the branch of XYZ Inc. in India. There is no DTAA between India and Country M. T(P) Ltd. has entered into certain international transactions during the P.Y. 2022-23 and P.Y. 2023-24. T (P) Ltd. invested in SS (P) Ltd of Country Y and received dividend of 550 lakhs during the financial year 2023-24. It declared and distributed interim dividend of 250 lakhs on 10.11.2023 and a final dividend of 230 lakhs on 12.11.2024. T (P) Ltd. has filed its return of income on 15.11.2023 for A.Y. 2023-24 and on 30.11.2024 for A.Y. 2024-25.