M/S Dit (International Taxation), ... vs M/S Morgan Stanley & Co. Inc

The Supreme Court addressed the applicability of the Double Tax Avoidance Agreement (DTAA) between India and the United States, specifically Articles 5(1) and 5(4), concerning the determination of a Permanent Establishment (PE) for Morgan Stanley & Co. The Court upheld the Authority for Advance Ruling's decision that MSCo did not have a fixed place of business PE in India, nor an agency PE through MSAS, but could be considered to have a service PE under Article 5(2)(l) if employees were sent to India. The ruling clarified the interpretation of PE under the DTAA, emphasizing the arm's length principle in transfer pricing.