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TMI Blog2015 (2) TMI 396X X X X Extracts X X X X X X X X Extracts X X X X ..... e ground No.1, the assessee is aggrieved with the action of Ld. CIT(A) by which he has confirmed the addition made by the Assessing Officer by calculating tax on gross receipts. In the 2nd ground of appeal, the assessee is aggrieved with the action of Ld. CIT(A) by which he had confirmed the addition made by the Assessing Officer by holding the receipt received by the assessee as fee for technical services under Article13 of DTAA between India and Norway instead of taxing it u/s 44BB of Income-tax Act, 1961. 3. In I.T.A.No. 6181/Del/2012, only one ground of appeal has been taken which is similar to ground No.1 as in I.T.A.No. 1295/Del/2013. 4. In I.T.A.No. 1283/Del/2013, the Revenue is aggrieved with the action of Ld. CIT(A) by which he h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iness or profession which was carried on by the assessee at any given time during the previous year. Mobilization and Demobilization are activities in connection with the business of the assessee in India. The movement of the vessel which is managed by the assessee is a part of the business of the assessee that is carried out in India and it is not an independent business or even an independent activity carried by the assessee. 14.2 The income in the case of the assessee is no doubt accruing or arising in India as the business is being undertaken in India. The source of revenue originates from ONGC who pays to EMGS who in turn pays to Siem Offshore Inc and the assessee receive fee from that entity. 14.3 Section 9 takes into account situat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has passed an order dated 09.07.2014 in the case of PGS Geophysical AS Vs ADIT wherein the Hon'ble High Court has laid down law regarding taxability for FTS for assessment years prior to 2011-12 and in this respect, a copy of the order of Hon'ble High Court was placed on record and a copy was provided to Ld. A.R. and we were taken to paragraph 20 of the said order wherein it has been held that the receipt of the assessee can be taxed u/s 44BB only if the assessee has a PE in India during the relevant period and the contract entered into by the assessee in India was effectively connected with that PE in India. Ld. D.R. submitted that above findings have not been made in the appeals under consideration, therefore, the case needs to go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... activities can be taxed u/s 44BB only if the two conditions are fulfilled. One of the conditions is existence of PE in India and second is regarding effective connection of such contract with the PE in India. In this respect, para 20 of Hon'ble High Court is reproduced below: "20. Having stated the above, we must clarify that the income falling within Section 115A(1)(b) of the Act which does not fall within the four corners of Section 44DA(1) of the Act would also not be taxable under Section 44BB(1) of the Act, for the reason that by virtue of proviso to Section 44BB(1) of the Act, the same is excluded. Accordingly, the Assessing Officer would specifically have to determine (a) whether the assessee had a PE in India during the relevan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, without commenting upon arguments of Ld. D.R. as contained in his synopsis, we have decided the issue against the assessee by following the judgement of Hon'ble Uttarakhand High Court. For the sake of convenience, the findings of Uttaranchal High Court in the case of Sedco Forex International Inc. Vs CIT 299 ITR 238 are reproduced below: "In the present case, a finding has been recorded by the Income-tax Appellate Tribunal that it was not in dispute before the Tribunal that the payment was made to the appellant-company outside India and the mobilization fee as claimed by the assessee was paid to the appellant by ONGC has no nexus with the actual amount incurred by the appellant-company for transportation of drilling units of rigs to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... given in I.T.A.No. 5283/Del/2010 we hold that the assessee was not liable to pay interest u/s 234B. Accordingly, ground is decided in favour of the assessee." 16. We find from the same order that while deciding I.T.A.No. 5283/Del/2010 in respect of charging of interest u/s 234B, the Tribunal; has decided the issue at para 175 which reads as under: "Considering the entirety of facts, we direct the Assessing Officer not to charge interest u/s 234B in respect of all contracts entered into by the assessee with various organizations in India except with respect of the contracts entered into with HOEC and ONGC. As far as income taxable u/s 44BB in respect of various contracts are concerned, the assessee itself has accepted the liability from t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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