9911796707
TMI Blog2012 (10) TMI 202X X X X Extracts X X X X X X X X Extracts X X X X ..... connected with Permanent establishment or Fixed place of Profession. As decided in case of [CGG Veritas Services, SA Versus Additional Director of Income-tax, (International Taxation 2012 (4) TMI 280 - ITAT DELHI] as entire project has to be executed by the assessee and all the terms of contract are similar with the only difference that the other party is a non-resident company. The amount received by the assessee will be assessable u/s 115A of the Act. Held that:- The receipts are liable to tax @10% as Fees is received in connection with PE and Place of Profession in India - Appeal is allowed in favour of assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... 34D of the Act disregarding the fact that the Appellant is a non-resident assessee and its entire revenues/receipts are subject to tax withholding in India under section 195 of the Act and the Appellant is not liable to pay advance tax in respect of such revenues. 4. The Ld. Assessing Officer has erred on facts and in law in initiating penalty proceedings under section 271B of the Act." 2. The only issue for consideration relates to taxability of fee for technical services under sec. 44BB or under sec. 44DA or under sec.115A of the Act. The facts of the case stated in brief are that the assessee carried out work with ONGC, Reliance Industries Ltd., Hardy Exploration & Production (India) Inc. & Westerngeco International Inc. GSPC & C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y. The AO finally passed order under sec. 143(3)/144(13) vide order dated 22.10.2010. 4. Before us when the matter came up for hearing the learned AR of the assessee submitted that the issue is squarely covered by the decision of ITAT in the case of CGG Veritas Services, SA v. Addl DIT, International Taxation [2012] 50 SOT 335. The learned AR of the assessee further submitted that terms of contract are to be seen. The assessee was engaged in providing the services in connection with 3D seismic data and processing thereof on board. He therefore, submitted that since the AO has applied provisions of sec. 44DA and as per decision of ITAT in the case of CGG Veritas Services, SA (supra) provisions of sec. 44DA are not applicable for the relevan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... collection of 3D seismic data and processing thereof on board. The ITAT Delhi Bench 'B', Delhi in the case of CGG Veritas Services, SA (supra) has observed in Para 46 of order as under:- "46. On combined reading of section 44DA(1) and 115A(1)(b) it is clear that the provisions of section 44DA(1) are applicable in the case of a non-resident assessee who carries on business in India through a permanent establishment, or perform professional services from a fixed place of profession, and fees for technical services paid under the contract is effectively connected with such permanent establishment or fixed place of profession in India. In section 115A(1)(b) the Finance Act, 2003 with effect from 1.4.2004 substituted words " ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 44DA); (ii) Fee for technical services rendered in connection with prospecting for or extraction or production of mineral oil without having business PE or fixed place of profession - (section 115A); (iii) Other fee for technical services having business PE or fixed place of profession - (section 44DA); (iv) Other fee for technical services without business PE or fixed place of profession - (section 115A); Thus it is abundantly clear that with effect from assessment year 2011-12 fee for technical services whether rendered in connection with prospecting for or extraction or production of mineral oil or otherwise will be assessable either u/s 44DA or section 115A of the Act depending on fact whether such receipts are effectively con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Act for the simple reason that Proviso to sec. 44BB(1) does not contain sec.44DA for these years. In the instant case as argued by the learned CIT-DR, issue relating to PE or fixed place of business or profession has not been examined by the AO. Therefore, we feel it proper to set aside the matter to the file of the AO with the direction to examine the issue whether in the relevant assessment year the assessee had permanent establishment or fixed place of business or profession. The AO will also examine whether the contract was entered into between the parties before 1.04.2003 or subsequently. The AO will decide the issue in the light of decision of ITAT in the case of CGG Veritas Services, SA (supra) or any other decision of Hon'ble ..... X X X X Extracts X X X X X X X X Extracts X X X X
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