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2018 (6) TMI 1227 - AT - Income TaxApplicability of Section 44BB - AO denied the applicability of section 44BB in the draft assessment order on the ground that assessee had supplied the vessel to M/s. CGG Marine which was not a party to the production sharing contract with ONGC, instead he treated the entire receipt as royalty - interpretation of the so called ‘second leg contract’ so as to deny the applicability of the section to the assessee - Held that:- This Tribunal in assessee’s own case for the Assessment Year 2007-08 has decided this issue in favour of the assessee and held that provision of Section 44BB would be applicable. Now this issue stands settled in the case of ONGC vs. CIT [2017 (10) TMI 322 - SUPREME COURT OF INDIA], wherein after analyzing the various kinds of contracts by different foreign companies with whom ONGC executed various contracts for services to be rendered in connection with prospecting, extraction or production of mineral oil by ONGC and after detail analysis and discussion, held that any activity relating to exploration, prospecting, extraction, production of mineral oil would be covered u/s.44BB. They have also taken note into account various kinds of works which has been set out in detail in the judgment. Here also the supplying of vessels for the said purposes is inextricably connected with the prospecting, production of mineral oil and therefore, the order of the learned DRP is in consonance with the judgment of the Hon’ble Supreme Court, accordingly, the same is confirmed. - Appeal of revenue dismissed.
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