TMI Blog2009 (3) TMI 653X X X X Extracts X X X X X X X X Extracts X X X X ..... g Officer allowed deduction under section 33AC after making proper enquiries. Attention of the Bench was drawn on pages 25 to 27 where respective queries in respect to deduction under section 33AC have been made. Attention of the Bench was also drawn on page 46 of the paper book where working of calculation of deduction under section 33AC was filed. It was further submitted that the assessee has filed reply on 26-9-2000 and respective reply relating to the specific query has been given at pages 37 38, copies of which are placed at pages 31 to 38 of the paper book. It was further submitted that accordingly, the Assessing Officer allowed the deduction of Rs. 40 lakhs under section 33A while passing assessment on 12-3-2001. It was submitted that reopening of the assessment with any failure on the part of the assessee in disclosing fully and truly all material facts for claiming deduction under section 33AC, is bad in law that too beyond four years. Attention of the Bench was drawn on the respective provisions of law. 4. It was further submitted that similarly, assessment was made for assessment year 1999-2000 which was also reopened beyond four years period after completion of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction under section 33AC has been made on account of shipping business done on behalf of M/s. ONGC. Separate books of account are maintained by the assessee and therefore, the assessee is entitled for deduction under section 33AC. 7.1 It was further submitted that the main object of the assessee is to do shipping activities. Attention of the Bench was drawn on the Memorandum of Association (MoA), copy of which is placed on record. Attention of the Bench was also drawn on the Circular No. 717, dated 14-8-1995 by which the deduction is allowable to the extent of the total income provided the amount is credited to a reserve account and is utilized for the purchase of a new ship within the specified period. It was further submitted that the assessee has credited the amount to the reserve account as per provisions of law and have satisfied all the conditions for claiming deduction under section 33AC. It was explained that various Benches of the Tribunal have held that there should be activities of shipping and it is not necessary to have ship. It was further submitted that in the case of the assessee, who is owning a ship also and also done shipping activities on behalf of ONGC. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enance) contact with ONGC to operate anywhere in offshore India at any depth and undertake voyages as required to proceed to such area of operation as directed by ONGC. The assessee company was responsible for manning, victualling, operation, maintenance, repairs of the vessel from such ports without any extra costs to ONGC, the owner of the vessel. 8.1 The vessel was used to provide logistic support to offshore oil and gas exploration, exploitation and processing installations and other units under the control of the owner in the offshore India waters all lawful duties as directed by the owner. Various activities done by the assessee have been explained in the order of the CIT(A) at pages 2 3. The agreement executed by the assessee with ONGC with reference to the operation and maintenance of the ships owned by the ONGC were also filed. It was pointed out that the said agreement goes to show that the assessee had sufficient experience and is fully qualified to provide services such as hire manning, running operations, victualling and maintenance services for offshore supply vessels belonging to ONGC. Various clauses, terms and conditions of the agreement were explained before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent year 2000-01. 9.1 Before the CIT(A), it was stated that the Assessing Officer was wrong in holding that the core business of the assessee is not of shipping. The Assessing Officer had erred in holding that since the income of the assessee company from operation of ship was less as compared to the income from other activities; the assessee company s main object was not operation of ships. The method of percentage of receipts adopted by the Assessing Officer was wrong. It was submitted that the assessee is a registered public limited company and the main object of the company as mentioned in the MoA is that of shipping business. As shipping business is mentioned as its main object in MoA, it is enough for it to fulfil the condition as envisaged under section 33AC as that of carrying on the business of shipping operations. 9.2 After considering the submissions and other material on record, the CIT(A) found that the Assessing Officer was justified in rejecting the claim of the assessee under section 33AC. Various objections raised by the Assessing Officer in his order have been discussed by the CIT(A) at pages 6 to 9 of his order for assessment year 2000-01. 10. After c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onsideration, which are only on account of operation of ships as no other activity has been done by the assessee except operation of ships. In our considered view, the objections of the lower authorities were not justified in rejecting the claim of the assessee for deduction under section 33AC. 11. Various decisions relied upon by the ld. counsel are in support of the case of the assessee. Therefore, in view of the above discussions and in view of various case laws which are in support of the case of the assessee, we hold that the assessee is entitled for deduction under section 33AC. 12. The ground raised by the assessee in other appeals is similar for other years also. Therefore, for the same reasoning the claim of the assessee is allowed for deduction under section 33AC for other years also. 13. There is one more ground in appeal for assessment year 2002-03, i.e., ground No. 8 by which the disallowance of Dry Docking expenses of Rs. 1,13,82,244 has been confirmed. 14. The ld. counsel of the assessee stated that this issue is covered by the decision of the Tribunal in the case of the assessee for assessment year 2001-02 decided in ITA No. 6432/Mum./2004 vide o ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
