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TMI Blog2007 (10) TMI 175X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1961 (hereinafter referred to as "the Act") challenging the order dated September 23, 2005, passed by the Income-tax Appellate Tribunal, Delhi Bench "D", New Delhi (for short, the ITAT) in I. T. A. No. 3922/Del./2000 for the assessment year 1997-98, whereby the Income-tax Appellate Tribunal has modified the order passed by the Assessing Officer and affirmed by the Commissioner of Income-tax (Appeals) on two issues, firstly, that the amount worth Rs.5,88,30,840 was taken to be the basis for determining the deemed profits and gains under sub-section (1) of section 44BB of the Act at 1 per cent. in view of the Circular No. 1767 issued by the Central Board of Direct Taxes as this amount was received by the assessee as mobilization charges ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deemed profit basis 6,75,759 67,576 The Assessing Officer levied the tax as under: Gross receipts under the contract Rs. 12,96,59,137 1 per cent. thereof as deemed profit under section 44BB of the Income-tax Act 1,29,65,914 Total business income 1,29,65,910 Interest income on IT. refunds 20,39,499 4. The assessee filed an appeal before the Commissioner of Income-tax (Appeals), which was dismissed and the order of the Assessing Officer was affirmed. 5. Feeling aggrieved by the aforesaid order of the Commissioner of Income-tax (Appeals), the assessee preferred a second appeal before the Income-tax Appellate Tribunal and the Income-tax Ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lar of the Central Board of Direct Taxes is relating to activity of purchases made by the Indian company outside India by way of platform, rig or other facility fabricated by the foreign contractor as per the specific requirement of the Indian company organization outside India. It does not refer to mobilization charges. 9. A perusal of the circular shows that the Central Board of Direct Taxes had provided that 1 per cent. of the receipt by the foreign company on purchase of equipments by way of platform, rig or any other facility fabricated outside India shall be applied to determine the deemed profits and gains under section 44BB of the Act. 10. The Central Board of Direct Taxes is competent to issue the circulars under section 11 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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