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2021 (2) TMI 946 - AT - Income TaxTaxability of Amounts paid to the non-resident assessees /foreign companies for providing various services in connection with prospecting, extraction or production of mineral oil - Fee for technical services covered u/s 115A or it is inextricably connected with processing, extraction or production of mineral oil u/s 44BB - Payment for rendering services for microseismic acquisition, processing and interpretation of micro-seismic data in two observation wells during hydro-fracturing operations carried out in the wells at Bakrol oil field - Short deduction of tax deducted u/s 44BB - short deduction has been determined by the CPC-TDS in respect of deductees by treating that the tax was deductible at 10% u/s 115A - HELD THAT:- Following the decision rendered in Oil & Natural Gas Corporation Ltd. [2015 (7) TMI 91 - SUPREME COURT] we are of the considered view that ld. CIT (A) has erred in treating the services rendered by M/s. ESG Solutions to the assessee in the nature of technical services to be covered u/s 115A of the Act rather these services are inextricably connected with prospecting, extraction or production of mineral oil petroleum products and these services are to achieve dominant purpose by rendering services for micro seismic acquisition, processing and interpretation of micro-seismic data in two observation wells during hydro-fracturing operations carried out in wells at Bakrol oil fields. Consequently, services rendered by the non-resident company fall within the purview of presumptive provision of section 44BB of the Act and the addition made by the AO and confirmed by the ld. CIT (A) is not sustainable, hence ordered to be deleted. Consequently, the appeal filed by the assessee is allowed.
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