No Fixed Place PE in India If Travel Agents Themselves Arrange for Communication Link to Access CRS | ITAT

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  • Last Updated on 28 February, 2024

computer reservation system; CRS

Case Details: Sabre GLBL Inc. vs. ACIT - [2024] 159 678 (Delhi-Trib.)

Judiciary and Counsel Details

    • G. S. Pannu, Vice President & Anubhav Sharma, Judicial Member
    • Tarandeep Singh, Adv. for the Appellant.
    • Vizay B. Vasanta, CIT-DR for the Respondent.

Facts of the Case

The assessee is a company incorporated and tax resident of the USA. It entered into participating carrier distribution and services agreements with various airlines to facilitate airline ticket booking. It was providing related services through a computer reservation system (CRS). It earned booking fees from various participating airlines for such services. It had also entered into subscriber agreements with global travel agencies in India with presence/affiliates in multiple countries, including India, and had granted them access to the assessee’s CRS.

During the assessment proceedings, the Assessing Officer (AO) taxed the entire income earned by the assessee on the grounds that it had a fixed place, which was a Dependent Agent Permanent Establishment (DAPE). Contending it to be a business connection in India under section 9(1), the AO made additions to the assessee’s income.

On appeal, the Dispute Resolution Panel (DRP) upheld the AO’s order, and the assessee filed an appeal with the Delhi Tribunal.


The Tribunal held that the assessee entered into subscriber agreements with global travel agencies with a presence or affiliates in multiple countries, including India, and granted them access to its CRS. The assessee was not responsible for providing any computer, printers, communication lines, etc., to the Indian subsidiary of Global Travel Agents.

There was no arrangement to provide any computer, printer, or software installed on the computer at the premises of a travel agent in India. Nor was there any financing for such equipment. The agent was allowed to access the assessee’s CRS mainframe located in the USA through nodes and networks, which these travel agents independently source on their own, and the assessee in no way insisted, assisted, provided or facilitated in providing such communication link. Further, the assessee had no office or employee in India.

Further, there was no exclusivity for entities entering global subscriber agreements. They were unrelated parties acting in their ordinary course of business with no exclusiveness to each other. Accordingly, it was held that there was no agency PE.

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