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2018 (12) TMI 582 - HC - Income TaxDrilling rig as a qualifying ship within the meaning of Section 115VD - Held that:- This issue is covered against the Revenue by decision of the Delhi High Court dated 8th November, 2012 the Commissioner of Income Tax, New Delhi versus Jagson International Limited. [2012 (11) TMI 594 - DELHI HIGH COURT] in the case of offshore installations which are stationed at one place, the very nature of the activity in which the assessee engaged is to carry out operations in different places; necessarily, at least for a short duration the vessel has to be stationed at one place. In these circumstances, Revenue’s contentions that the vessel is nothing but “offshore installations” has no merit, in the case of Matdrills of the kind put to use by the assessee - reasoning and findings of the Appellate Commissioner and the Tribunal cannot be found fault with - Decided in favour of the assessee Disallowance under Section 14A - Held that:- Supreme Court in Godrej Boyce Manufacturing Company Limited versus Deputy Commissioner of Income Tax Mumbai & Anr. [2017 (5) TMI 403 - SUPREME COURT OF INDIA] after referring to Section 14A has held that Rule 8D is in the nature of best judgment determination as it prescribes a formula for determination of the expenditure incurred in relation to income that does not form part of the total income under the Act, in a situation where the assessing officer is not satisfied with the claim of the assessee. The jurisdictional requirement for invoking Rule 8D is recording of satisfaction by the assessing officer that having regard to the accounts of the assessee placed before him, it is not possible to generate requisite satisfaction with regard to the correctness of the claim of the assessee. It is only then that the provisions of Sub-section 2 and 3 to Section 14A read with Rule 8D of the Rules or best judgment determination can be applied. This statutory mandate is not satisfied in the present case.
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