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TMI Blog2015 (4) TMI 557X X X X Extracts X X X X X X X X Extracts X X X X ..... under section 44BB, however, this would be applicable from assessment year 2011-12 and for the assessment years 2004-05 to 2010-11 the FTS also would be taxable under section 44BB (1). See Baker Hughes Asia Pacific Ltd., C/o Nangia & Co., and others Versus Addl. Director of Income-tax, International Taxation, Dehradun [2014 (7) TMI 601 - ITAT DELHI]. We uphold the order of the Ld. CIT(A) for the assessment year 2010-11 dated 05.03.2013. Hence we dismiss the appeal of the Revenue for assessment year 2010-11. - decided against revenue. - I.T.A .No. 5561/Del/2011, I.T.A .No. 4650/Del/2013, I.T.A .No. 4650/Del/2013 - - - Dated:- 12-2-2015 - Sh.J.S.Reddy And Sh. George Geroge.k JJ. For the Appellant : Amit Arora, Suraj Nangia, CAs For the Respondent : Sanjeev Sharma, CIT DR ORDER Per J.S.REDDY, AM ITA No.-5561/Del/2011 is filed by the assessee directed against the order passed by the AO u/s 144C r.w.s 143 of the Income Tax Act for the 2008-09 assessment year. ITA No.-4650/Del/2013 is an appeal filed by the Revenue directed against the CIT(A)-II, Dehradun dated 21.05.2013 for the assessment year 2010-11. CO No.-29/Del/2014 is a cross-objection filed by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s exploration and production like BG exploration and production India Ltd. and Cairn Energy India and are partners in a production sharing contract. On facts it held as follows:- A perusal of the scope of work of the Contract with B.G. Exploration in section B-1 SERVICES shows that the assessee is to supply equipment and services for safe and efficient well testing operation . Similarly perusal of para 5 and 5.1 of the Contract with Cairn India which lay down the Scope of Work shows that the assessee is to provide equipments to perform surface testing services, service technicians and facilities for testing equipment storage, equipment servicing etc. para 5 of the Contract with Jubilant Oil provides the scope of work for that contract. A perusal of this shows that the assessee is to provide Well Testing equipment and services and such testing is to be done using a full slimhole DST string or with a production test string incorporating a Wireline retrievable downhole in tool. Thus the services provided under all the three Contracts relate to well testing by Wireline or similar procedures. 4. Thereafter it followed the panels decision in the case of M/s Precision NHC Servi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2009-10, ignoring the fact that appeal has been followed before the Hon'ble ITAT against his decision for Asstt Year 2009-10. 2. Whether on the facts and circumstances of the case the Ld. CIT (A) has erred in holding that the income of the assessee was taxable under the provisions of sec 44BB of the IT Act, 1961 without adjudicating the aspect of eligibility in terms of second limb of the exclusionary proviso (Explanation to section 9(1 )(vii) of the IT Act, 1961) i.e. for a project undertaken by the recipient as confirmed by Hon'ble Delhi High Court in DIT Vs Rio Tinto Technical Services [2012- TII-01-HC-DEL-INTL]. 3. Whether on the facts and circumstances of the case the Ld. CIT (A) has erred in holding that the income of the assessee was taxable under the presumptive provisions of sec 44BB ignoring the fact that taxability under section 44BB shall not apply in respect of income referred to in section 44DA of the I.T. Act in view of the clarificatory proviso to sec 44 BB and Sec. 44 DA and corroborated by clarificatory proviso to sec. 44BB and sec 44DA. 4. Whether on the facts and circumstances of the case the Ld. CIT (A) has erred in its interpretation of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the fact that proviso to section 44DA brought about by the Finance Act 2010 was only clarificatory in nature and its application has to be read into the main provisions with effect from the time the main provision came into effect in view of the decision of the Hon'ble Supreme Court in the case of Sedco Forex International Drilling v/s CIT. 11. The appellant prays for leave to add, amend, modify or alter any grounds of appeal at the time or before the hearing of the appeal. 8. The assessee filed cross-objections. 9. As the issue raised in all the cases are identical, for the sake of convenience, they are heard together and disposed off by way of this common order. 10. We have heard the Sr. Sanjeev Sharma, Ld.CIT DR on behalf of the Revenue and Sh. Amit Arora, the Ld. Counsel on behalf of the assessee. The submission of the Revenue are extracted for ready-reference:- A brief of the arguments/replies of the Revenue in the cases of Expo Gulf Limited on the issue of non- applicability of Section 44BB Assessment Years: 2008-9 to 2010-11 1. During the years the assessee earned revenue from its contracts with ONGC Ltd, Cairn Energy Limited, Halliburton Offshore Se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n accordance with the provisions of section 44DA or section 115A of the Act depending on whether the FTS is effectively connected with the permanent establishment or not. 7. In paragraph 50 of the Order, the Hon'ble Tribunal has held that the consideration of the nature of fee for technical services other than those covered u/s 44DA will be assessable u/s 115A(l)(b) of the Act. This would the case for FTS not being effectively connected with the PE. 8. The Hon'ble High Court in the case of OHM Ltd (page 33 to 35 of the PB) also arrived at the similar finding that FTS, taxable under section 44DA, will be taxable under section 44BB as amendment in the section 44BB and 44DA is applicable from assessment year 2011-12 and has prospective application. 9. The Hon'ble Delhi High Court has passed an order dated 09.07.2014 in the case of PGS Geophysical AS Vs Addl. Director of Income Tax (2014-TII-35-HC-DEL-INTL) wherein the Hon'ble Court has confirmed the finding of treating the consideration for rendering acquisition and processing of 2-D and 3-D seismic data services as fee for technical services and laid down law regarding taxability of FTS for the assessment yea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sions Energy Services Ltd. of assessment year 2007-08 in ITA No.-5286/Del/2010 and held that under the facts and circumstances of the case, the income is taxable u/s 44BB of the Act. The reason is that the scope of work as per the contracts requires, the assessee to provide a rig based surface well, testing equipment alongwith operating personnel. Thus the order of the DRP in the case of M/s Precision Energy Services Ltd. is no more good law. Hence we have to reverse this impugned order of the DRP. 14. Hence consistent with the view taken by the Co-ordinate Bench in ITA No.-5286/Del/2010, ITA No.-5283/Del/2010 and other cases, vide order dated 11.07.2014 and applying the propositions laid down by the Hon ble Uttarakhand High Court and Hon ble Delhi High Court in similar situation to the facts of the present case, we reverse the order of the DRP for assessment year 2008-09. We uphold the order of the Ld. CIT(A) for the assessment year 2010-11 dated 05.03.2013. Hence we dismiss the appeal of the Revenue for assessment year 2010-11. 15. We allow the appeal of the assessee in ITA No.-5561/Del/2011 for the assessment year 2008-09. 16. The CO-29/Del/2014 for the assessment year ..... X X X X Extracts X X X X X X X X Extracts X X X X
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