Indian Supreme Court decision on whether captive BPO activities give rise to PE and income attributable to PE on such activities

The Supreme Court of India delivered a ruling dated 9 June 2007 in the case of Morgan Stanley & Co., United States (the Applicant) on whether the captive business process outsourcing (BPO) activities of the company gave rise to a permanent establishment (PE) in India and the amount of income attributable to the PE.

(a) Facts. For the facts (including abbreviations used) and the advance ruling dated 13 February 2006 delivered by the Indian Authority for Adva…