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2016 (1) TMI 813 - AAR - Income TaxConsideration received under the ‘Change Order’ - whether is in the nature of business profits? - Taxability of income - providing ‘Floating Production Storage and Offloading’ (FPSO) - Fabrication and installation of new living quarters onboard the FPSO facility and procurement and installation of Heating, Ventilation Air Conditioning system (‘HVAC’) system onboard the living quarters - Major work was done outside India. Held that:- The consideration received by the applicant under the Change Order for undertaking the scope of work is in the nature of business profits. The entire consideration received for the scope of work is taxable in India under the provisions of section 44BB of the Act. The consideration received for installation of STP buoy and moorings in India is in the nature of business profits and is chargeable to tax under the provisions of section 44BB of the Act. The entire consideration received for mobilization of the FPSO is taxable under the provisions of Section 44BB of the Act without splitting the same on the basis of travel of the FPSO outside or in India. The consideration received on account of insurance receipts for loss of hire is not taxable in India.
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