Income chargeable to tax u/s 172.

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... rt dt. 17-11-92, it was stated that income charged to tax u/s.172 of the I.T. Act is a deemed income and there is no scope for allowing any deduction for any expenditure or outgoings since the presumption is that while estimating the income at the prescribed rate of 7.5%, the expenditure and outgoings by the non-resident Shipping companies for the purpose of earning the freight income have been ta .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... e addressed to the ITO, Company Ward-I(4), Madras. The letter makes it clear that there are no agreements between the exporters and the mother vessel operators. It is vaguely suggested that it is the local shipping agent who books the cargo and collects the freight. From this, no inference can be drawn regarding the determination of the amount which is paid or payable to the non-resident shipping .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... earnings as per the Bill of lading. Instead of directly incurring the expenditure by operating its own ship, the mother ship operator incurs expenditure through payment to the daughter vessel operator, the mother ship operator is spared of incurring the expenditure for taking the cargo from the Indian ports to Singapore/Colombo. Therefore, while estimating the income at 7.5% of the freight earnin .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X