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TMI Blog2003 (7) TMI 28X X X X Extracts X X X X X X X X Extracts X X X X ..... essee and against the Department. - - - - - Dated:- 15-7-2003 - Judge(s) : Y. R. MEENA., PRAKASH TATIA. JUDGMENT On an application under section 256(1) of the Income-tax Act, 1961, the following questions were referred for the opinion of this court: "Whether, on the facts and in the circumstances of the case, the Income-tax Appellate Tribunal is legally justified in: 1. Upholding the order of the learned Commissioner of Income-tax (Appeals) who held that the amount of corporate tax paid by the OIL on behalf of the company falls under section 44BB(2) and therefore, only 10 per cent. of that amount may be treated as income of the assessee? 2. Observing that the amount of corporate taxes paid by the OIL on behalf of the non-resid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... surtax is perquisite and that has to be added, as provisions of sub-clause (iv) of section 28 are not contrary to section 44BB of the Act. In appeal before the Commissioner of Income-tax (Appeals) (sic), the Appellate Tribunal after hearing the parties; allowed the appeal observing that in view of the provisions of sub-section (2) of section 44BB of the Income tax Act, the tax can be levied at only 10 per cent. of the gross receipts. The gross receipts included the amount of tax and surtax, paid by the Oil India Ltd., on behalf of the assessee. That view has been affirmed even by the Taxation Tribunal. None appeared for the assessee. We have heard learned counsel for the Department, Mr. Bhandawat, who has supported case of the Departme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n obstante clause, 10 per cent. of aggregate amount received, be treated as deemed income of the assessee for that year. This tax paid by the company is also one of the amounts received, which can be deemed to have been received by the assessee and paid. Therefore, there is no question of taking the total tax amount, paid by the Indian company on behalf of the foreign assessee to tax. Only 10 per cent. of that amount can be taxed under section 44BB(2) of the Act. In view of this, we do not find any infirmity in the view taken by the Commissioner of Income-tax (Appeals) and the Tribunal. Further, that view finds support from the decision of the Orissa High Court in Oil India Ltd. v. CIT [1995] 212 ITR 225. In the result, we answer the ques ..... X X X X Extracts X X X X X X X X Extracts X X X X
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