TMI Blog2003 (1) TMI 708X X X X Extracts X X X X X X X X Extracts X X X X ..... regard to the addition made by the Assessing Officer connected with the ancillary charges amounting to ₹ 6,60,47,066. 3. Apropos the ancillary charges, assessee did not dispute the addition before the CIT(A). For the first time issue was raised before us. It was stated to be a legal issue. Ater hearng learned Departmental Representative, we permit the assessee to raise this issue before the Tribunal. 4. We have heard the rival submissions in the light of material placed before us and precedents relied upon. Shri F.V. Irani, learned counsel for the assessee, appeared before us. Our attention was invited on Article 9 of the Convention between Republic of India and the Kingdom of Denmark for the Avoidance of Double Taxation and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of goods or merchandise in international traffic. Learned counsel for the assessee contended that the slot fee and ancillary charges cannot be construed to be income derived from the operaton of ships. As such, these cannot be taxed under Article 9(2). It was stated that the several heads of income mentioned in the I.T. Act are mutually exclusive. A particular income can come only under one of them. If the income can be brought under one head, it cannot be brought under residuary head if the heads of income are mutually exclusive. The heads of income must be decided on the nature of income by applying the practical common notions and not by reference to the assessee';s treatment of income. As such, if the income is not coming within ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ciding the issue, it is necessary to note that what is slot fee. The Random House Dictionary defines the word ';SLOT'; as a narrow, elongated groove, specially a narrow opening for receiving or admitting something. In shipping business, this term is used to denote the payment for carrying cargo to an intermediate port, wherefrom cargo is transshipped to the final destination. Say for example from Madras cargo is to be carried to London. Ship to London is available for Colombo. X shipping company undertakes the contract to carry the cargo from Madras to London. A ship of X company is at Colombo. From Madras to Colombo cargo is carried by Y company, Y company is paid by X company. This is slot fee . 8. Details of ancillary charges ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id or payable or received or deemed to be received, as the case may be, by way of demurrage charges or handling charges or any other amount of similar nature. 10. Section 90, sub-section (2) of the Act reads as under: (2) Where the Central Government has entered into an agreement with the Government of any country outside India under sub-section (1) for granting relief of tax, or as the case may be, avoidance of double taxation, then, in relation to the assessee to whom such agreement applies, the provisions of this Act shall apply to the extent they are more beneficial to that assessee. 11. The prescription of section 90(2) can be invoked only if DTAA applies to the income in dispute. Article 9 says about profit derived from th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is to be charged to tax in India in accordance with the provision of Article 9(2) of the DTAA. To construe the meaning of the words such profits as used in Article 9(2), learned counsel argued that such profits means profits from operation of ships. Slot charges and ancillary charges are not the profits from the operation of ships. As such, these cannot be taxed under Article 9(2). In the same breath, he says that as there is no provision in the DTAA for taxing such profits, therefore, no tax should be charged on such profits. For that, he relied on Smt. T.P. Sidhwa';s case (supra) and Nalinikant Ambalal Mody';s case (supra). These decisions are not pertinent to the issue. If a special provision is made on a certain matter, the m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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