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2010 (3) TMI 113 - AAR - Income TaxSpecial provision for computing profits and gains in connection with the business of exploration, etc., of mineral oils – Section 44BB - The applicant is a marine geophysical company that conducts seismic survey and provides offshore seismic data acquisition and other associated services to global oil companies. - The applicant was awarded a three year contract by ONGC for 3D Seismic data acquisition and onboard processing Offshore India during field season 2008-09, 2009-10 and 2010-11. For the purpose of executing the contract with ONGC, the applicant has entered into a global Time Charter Agreement with Geo Subsea Pte Ltd., a company incorporated in Singapore, for the provision of seismic vessel. Held that - as per Section 44BB read with Part II of the First Schedule to the Income Tax Act, the effective rate at which the tax has to be withheld from the payments made by the applicant to P.F. Thor would be 4.223% - As the amounts falling under Section 44BB of I.T. Act have been excluded from the purview of the royalty definition, this question has to be answered in the negative. Once Section 44BB is attracted, it is common ground that the computation has to be made in accordance with that provision and no other special provision, viz., Section 44DA or Section 115-A would come into play in view of the fact that the payment is being made by a non-resident to another non-resident.
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