The Supreme Court has ruled that a non-resident company can be taxed in India on income that accrues or arises from a business connection in the country, even without a permanent office or physical presence. Deciding in Pride Foramer S.A. v. Commissioner of Income Tax (2025 INSC 1247), the Court restored Income Tax Appellate Tribunal relief to the company and overturned the Uttarakhand High Court’s restrictive stance. It clarified that a “permanent establishment” applies under tax treaties, not domestic law, and directed reassessments accordingly. The judgment emphasizes that bids and correspondence can demonstrate ongoing business activity in India.
