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M/s Fugro Geoteam AS Versus The Additional Director of Income-tax, International Taxation, Dehradun

2015 (4) TMI 301 - UTTARAKHAND HIGH COURT

Fees from technical services - assessee is foreign company incorporated under the laws of Norway engaged in the activities relating to acquisition of 3D sesismic data under contracts with Reliance Industries Ltd. and ONGC - Tribunal held that the mobilization/demobilization fee received by the appellant on account of services provided/vessel operated outside India were to be included in calculating the aggregate amount referred to in sub-section (2) of Section 44BB - Held that:- As clear from th .....

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laim the benefit of sub-section (3) of Section 44BB, we do not see how the appellant can be heard to argue that the amount which he has received by way of mobilization advance outside India should not be included for the purpose of calculating the income under section 44BB in the teeth of the clear provision contained in sub-section (2) of Section 44BB. On our understanding, the provisions contained in Section 5 (2) of the Act will not stand on the way of the Authorities insisting on the amount .....

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Section 260A of the Income-Tax Act, 1961 (hereinafter referred to as the Act ). The assessee is foreign company incorporated under the laws of Norway. It is engaged in the activities relating to acquisition of 3D sesismic data under contracts with Reliance Industries Ltd. and ONGC. The relevant assessment year is 2008-2009. The return of income was filed on 28.11.2008 declaring income of ₹ 18,27,42,870/- from contract receipt under Section 44BB of the Act. It was selected for scrutiny. The .....

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t and also learned counsel for the Department. 3. The questions of law, which have been raised, are as follows:- a. Whether on facts and in the circumstances of the case, the Honble Tribunal erred in law in not appreciating the true construction of Section 44BB of the Act ? b. Whether on the facts and circumstances of the case and in law, the Tribunal erred in law in holding that the mobilization/demobilization fee amounting to ₹ 28,21,23,166/- received by the appellant on account of servi .....

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Tax and another). 5. Learned counsel for the appellant would, however, contend that the substantial question of law, which is raised in this case, specifically, namely, substantial question of law No.2, which is, whether the income of the appellant received outside India can be brought to tax under Section 44BB of the Act has not been answered by the said judgment. 6. Per contra, learned counsel for the revenue submits that the questions are answered. We allowed the learned counsel for the appel .....

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the territory of India or rather outside India. In regard to the mobilization advance which was received within the territory of India, there can be no objection and the appellant offered it also. But the objection is taken to the said amount being the subject matter of levy under Section 44BB for the reason that if that was permitted that would be in the teeth of the provision contained under sub-section (2) of Section 5 of the Act. Sub-section (2) of Section 5, no doubt, relates to a charge o .....

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loration, etc., of mineral oils:- (1) Notwithstanding anything to the contrary contained in sections 28 to 41 and sections 43 and 43A, in the case of an assessee, being a not-resident, engaged in the business of providing services or facilities in connection with, or supplying plant and machinery on hire used, or to be used, in the prospecting for, or extraction or production of, mineral oils, a sum equal to ten per cent of the aggregate of the amounts specified in sub-section (2) shall be deeme .....

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ther in or out of India) to the assesse or to any person on his behalf on account of the provision of services and facilities in connection with, or supply of plant and machinery on hire used or to be used in the prospecting for, or extraction or production of, mineral oils in India; and (b) the amount received or deemed to be received in India by or on behalf of the assessee on account of the provision of services and facilities in connection with, or supply of plant and machinery on hire used .....

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ing Officer shall proceed to make an assessment of the total income or loss of the assessee under sub-section (3) of section 143 and determine the sum payable by, or refundable to, the assessee. 7. Sub-section (1) of Section 44BB proclaims that in respect of a non-resident which the appellant claims it is, if it is to be computed under section 44BB it will be assessed as provided in sub-section (2) of the Act. It starts with a non-obstante clause but the non- obstante clause is confined in its f .....

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spect of the income of a non-resident and relating to the activities which are mentioned therein. It provides for taxation with reference to pre-ordained criteria which are mentioned in the provision itself. In other words, the mechanism is specified by the statute. The amounts received or payable to the assessee, who is a non-resident, whether in India or outside India, have to be included for the purpose of calculating the income under Section 44BB. This is a special provision which may be ava .....

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