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TMI Blog2006 (9) TMI 361X X X X Extracts X X X X X X X X Extracts X X X X ..... enience. 2. The identical ground of the appeals is stated as under : "The Ld. Commissioner of Income-tax (Appeals)-I, Dehradun has erred in law and on the facts and circumstances of the case in rejecting the appellant s contention that the receipts of the non-resident were taxable under section 44BB of the Income-tax Act, 1961 ( Act ) and no as fees for technical services under section 44D, read with section 115 of the Act." 3. Since the facts involved in both these appeals are identical except variation in amounts, we are only stating the brief facts from the appeal of the assessees relating to assessment year 1998-99. The assessee filed a return of income in this case on 23-11-1998 declaring a total income of Rs. 86,610. The a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontemplated under section 44BB and was to conduct training programmes at Ahmedabad for ONGC officers so section 44D read with section 115A were applicable and hence he upheld the order of the Assessing Officer. 6. We have considered the rival submissions of both the parties, perused the records and carefully gone through the orders of the tax authorities below. 7. In this case undisputedly a non-resident was engaged by ONGC for imparting training on "Ceased Hole and Production Log Evaluation" and on "Ceased Hole and Production Log Analysis". As per Instruction No. 1862, the CBDT with regard to the definition of "fee for technical service" in Explanation 2 to section 9(1)( vii ) of the Income-tax Act, 1961 made following clarificat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under the provisions of section 44BB of the Income-tax Act, 1961 and not under the special provisions of the taxation of fees for technical services contained in section 115A, read with section 44D of the Income-tax Act, 1961." 8. From this clarification issued by the CBDT, now it is clear that the consideration paid for rendering all services like imparting of training and carrying out drilling operations for exploration or exploitation of oil and natural gas will not be treated as fees for technical services for the purpose of Explanation 2 to section 9(1)( vii ) of the Income-tax Act and so payment of such services to a foreign company would, therefore, be income chargeable to tax under the provisions of section 44BB of the Inco ..... X X X X Extracts X X X X X X X X Extracts X X X X
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