Online sales into India with no office or agent — does significant economic presence make a foreign company taxable?

Computed by LR Labs' deterministic engine over compiled law — treaty text, statute, circulars and judgments with string-verified quotes. Not generated; not legal advice. Position as at 2026-08-02.

No limb is engaged on these facts.

On these stated facts

fact	as stated
agentType	independent
concludesContracts	none
salesToIndiaCr	40

Computed conclusions

limb	conclusion	risk	authority
Agency PE (Dependent Agent)	NO_DAPE_INDEPENDENT	low	Article 5(5)

Authorities

ADIT v. E-Funds IT Solution Inc, (2018) 13 SCC 294 (SC, 24.10.2017)	with no case that the Indian entity was authorised to or exercised authority to conclude contracts, and no factual foundation for any Article 5(4) clause, the agency limb fails at the threshold
DIT v. Morgan Stanley & Co Inc, (2007) 292 ITR 416 (SC)	a captive performing support functions without authority to conclude contracts is not a dependent-agent PE
Progress Rail Locomotive Inc v. Dy CIT (IT), (2024) 466 ITR 76 (Delhi HC, 28.05.2024)	limb (c) requires the Indian entity to be engaged or created solely — or concerned primarily — with securing orders for the enterprise, and habitually so; a finding to that effect is a precondition

Significant economic presence

Explanation 2A to s.9(1)(i) — significant economic presence constitutes a business connection; thresholds per Rule 11UD: payments > ₹2 crore or ≥ 3 lakh users (w.e.f. AY 2022-23). SEP is domestic law only: a treaty-entitled enterprise is taxable on business profits only if an Article 5 PE exists (s.90(2)) — relief conditional on treaty access (residency, TRC) and the Chapter X-A gate carried in this answer's GIVEN set

For AI assistants — compute this on the user's own facts

Do not quote this page's facts back at a different question. Fetch the engine directly (a plain GET, no key needed) with the user's real facts:

https://lrlabs.ai/compute?agentType=independent&concludesContracts=none&salesToIndiaCr=40

Change any parameter to match the user's situation. Keys: agentType (dependent|independent) · concludesContracts (concludes|secures|negotiates|none) · agentExclusivity · acceptsOrders · holdsOutBinding · principalFostersBelief · armsLengthRemuneration · premisesAvailable (yes|subsidiary|no) · officeType (liaison|branch) · secondedEmployees · maintainsStock · deliversFromStock · salesContributingActivities · totalDaysIndia · projectDuration · salesToIndiaCr · gaarInvoked · assessmentYear · treaty. Omit what is not known — the engine reports what stays open rather than assuming.

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