The Supreme Court of India delivered a ruling dated 18 May 2007 in the case of Commissioner of Income Tax v. Hyundai Heavy Industries Co. Ltd. (291 ITR 482) on whether a South Korean company was liable to tax in India on the offshore portion of a composite contract executed in South Korea, and also when does a permanent establishment (PE) come into existence in India in such contracts.
(a) Facts. The Taxpayer (i.e. Hyundai Heavy Industries Co. Ltd.; henceforth "…