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2015 (6) TMI 436 - AT - Income TaxDeclaration of income under the provision of Section 44BB - Held that - Revenue of the assessee is effectively connected with PE in India is concerned, it is found that the Assessing Officer has already examined the effective connection of the Revenue of the assessee with the PE in India while holding that the income of the assessee is taxable under sec. 44DA of the Act. As noted that the ruling of AAR in the case of Geophzika Torun SP. GO. 2009 (12) TMI 4 - AUTHORITY FOR ADVANCE RULINGS has been confirmed in the case of DIT vs. OHM Ltd. (2012 (12) TMI 422 - DELHI HIGH COURT). The said judgment was followed in the assessment year 2008-09 in the case of PGS Geophysical AS (2014 (7) TMI 723 - DELHI HIGH COURT ). In the light of above judgments held that for the relevant assessment year i.e. 2008-09, the assessee is entitled to declare its income under the provisions of sec. 44BB of the Act. The Learned CIT(Appeals) was thus justified in holding so. - Decided in favour of assessee. Mobilization/demobilization of Vessel outside India - Held that - In view of the CIT & Another Vs. Atwood Oceanics Pacific Ltd. 2010 (5) TMI 453 - UTTARAKHAND HIGH COURT payments mentioned above, we hold that the revenue of ₹ 2,81,23,166/- arising from mobilization/demobilization of Vessel outside India is taxable. - Decided against assessee. Levy of Interest - Held that - Interest u/s 234B & 234C is not chargeable, since assessee is a non-resident and as such tax is to be deducted at source by Indian party. The Hon ble High Court in the case of DIT Vs. NGC Network Asia (2009 (1) TMI 174 - BOMBAY HIGH COURT ) and DIT Vs. Clifford Chance LLP 2009 (7) TMI 1215 - BOMBAY HIGH COURT has decided issue in favour of assessee.
Issues:
1. Assessment under section 144C/143(3) of the Income-tax Act, 1961 for the relevant Assessment Year 2008-09. 2. Dispute regarding income declaration under section 44BB of the Act for seismic survey services. 3. Taxability of revenue arising from mobilization/demobilization of vessels outside India. 4. Applicability of presumptive profit rate on income from seismic survey services. 5. Levy of interest under sections 234B & 234C. Issue 1: Assessment under section 144C/143(3) of the Income-tax Act, 1961 The appeal was against the Assessing Officer's order dated 02.11.2011 under section 143(3) r.w.s 144C(13) of the Act for the Assessment Year 2008-09. The assessee, a foreign company, had filed its return of income declaring income from contract receipt u/s 44BB of the Act. However, the AO rejected this claim and taxed the income as fees from technical services. The Dispute Resolution Panel affirmed the assessee's view. The Hon'ble Delhi High Court's judgment in the case of Director of Income Tax-II Vs. OHM Ltd. was cited, supporting the assessee's entitlement to declare income under Section 44BB. Consequently, the assessee's appeal was allowed in this regard. Issue 2: Dispute regarding income declaration under section 44BB of the Act for seismic survey services The first ground raised by the assessee was in relation to the income declared under section 44BB. The DRP's observation noted that the Ruling of AAR in the case of Geophzika Torun Sp. Zo.o applied to the present case. The DRP refrained from interference due to the matter being sub-judice before the Delhi High Court. The Hon'ble Delhi High Court's judgment in the case of PGS Geophysical AS was cited, supporting the assessee's claim. The appeal was allowed in favor of the assessee for this ground. Issue 3: Taxability of revenue arising from mobilization/demobilization of vessels outside India The second ground raised by the assessee was regarding the taxability of revenue from mobilization/demobilization of vessels outside India. The DRP dismissed the plea, citing various judgments of the Hon'ble Uttrakhand High Court in favor of the revenue. The appeal was rejected based on the settled issue by the High Court of Uttrakhand. The revenue from mobilization/demobilization of vessels outside India was held to be taxable. Issue 4: Applicability of presumptive profit rate on income from seismic survey services The assessing officer had computed the income from seismic survey services by adopting a presumptive profit rate of 25 per cent. The issue was raised by the assessee, disputing this computation. The matter was not specifically addressed in the summary provided. Issue 5: Levy of interest under sections 234B & 234C Interest under sections 234B & 234C was deemed not chargeable as the assessee was a non-resident, and tax was to be deducted at source by the Indian party. Citing judgments in favor of the assessee, the appeal was partly allowed, and interest under sections 234B & 234C was held not chargeable. In conclusion, the judgment addressed various issues concerning the assessment under the Income-tax Act, 1961 for the relevant Assessment Year 2008-09. The decision was detailed and based on legal precedents, ultimately resulting in the partial allowance of the assessee's appeal.
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