Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2023 (4) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (4) TMI 104 - AT - Income TaxAddition as royalty u/s 9(1)(vi) r.w.s.115A - Characterisation of receipts - receipts on giving on hire vessels for use or to be used in prospecting for, or exploration or production of mineral oils - whether the disputed receipts are taxable as business profits of the assessee under section 44BB of the Act or are in the nature of royalty as defined in Explanation 2 (iva) to section 9(1)(vi) ? - assessee is a non-resident corporate entity incorporated under the laws of Singapore and is a tax resident of Singapore - Whether the activities of seismic duties and transport of coated pipes would be covered under the provisions of section 44BB ? - HELD THAT:- The language employed in section 44BB is wide enough to encompass the aforesaid activities. In fact, the decisions relied upon by learned counsel for the assessee clearly support the aforesaid view. In case of Valentine Maritime (Gulf) LLC Vs. ADIT [2017 (1) TMI 1208 - ITAT MUMBAI] has held that receipt from giving on hire tugs and barges to be used in prospecting for, or extraction or production of mineral oils would come within section 44BB of the Act. The same view was expressed in case of Larson & Toubro Ltd. [2022 (3) TMI 84 - BOMBAY HIGH COURT] Western Geco International Ltd. has expressed the view that the seismic data services and mining projects are inextricably linked to activities covered under section 44BB. Thus, we hold that the receipts are covered under section 44BB Since the assessee did not have any PE in India, section 44BB would not apply - On a careful reading of section 44BB of the Act, we do not find any such requirement as has been pointed out by learned DRP. Section 44BB applies to a non-resident entity carrying on business in connection with prospecting for, or extraction or production of mineral oils. The provision, unlike section 44DA, does not put any mandatory condition of existence of PE for the applicability of the provision. We do not agree with the view expressed by the AO and DRP. Accordingly, we direct the AO to tax the receipts under section 44BB of the Act. This ground is allowed. Double counting of the revenue - As alleged that the assessee failed to provide the bank statements and summary reconciliation sheets in terms with the direction of learned DRP - HELD THAT:- Considering the fact that the assessee itself has furnished copy of bank statements and summary reconciliation sheets before learned DRP, we do not see any reason, why they could not be furnished before the Assessing Officer. We direct the assessee to furnish requisite documents before the Assessing Officer, in which case, the Assessing Officer shall examine them and rectify the mistake of double addition, in case it is there. However, the assessee must be provided an opportunity of being heard before deciding the issue. Credit of TDS - HELD THAT:- As we direct the AO to factually verify assessee’s claim and allow credit of TDS in accordance with law.
|