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TMI Blog2016 (7) TMI 199X X X X Extracts X X X X X X X X Extracts X X X X ..... .11.2008 2010-11 16,30,88,322 UK NIR/MM/MH/SCO N/77/NOMI/GCA/ 08-09/PB-6003 04.07.2009 2010-11 The non-residents to whom the payments have been made are resident of United Kingdom (UK) in ITA No. 4998/Del/12 and 4652/Del/13 and of USA ITA No.4654/Del/13. 2.1. The nature of work of the contract were as under:- I.T.A. No. Nature of work 4998/Del/2012 The non-resident was engaged to process three dimensional (3D) seismic data of the block NEC-DWN- 2002/2 in Mahanadi Basin at its premises in UK. Seismic data indicates existence of hydrocarbons deep inside the earth and helps to identify where to drill for the same. 4652/ Del/ 2013 Under contract dated 04.07.2009: Association in Redevelopment and Management of Mumbai High Redevelopment Project for optimal exploitation of Hydrocarbon Resources of ONGC. Under contact dated 14.11.2008: Assist ONGC in hiring integrated Consultant for Vashishta and S1 field development. 4654/ Del/2013 Assist ONGC in hiring Integrated Consultant for Vashistha and SI field development 2.2 The Ld. A.O. held that the services provided by the non-resident company to assessee are covered u/s 44DA of the Act. On appeal before Ld. CIT(A), the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ration! Mitsubishi Corporation (2010) ITR 578 (Delhi) which has not been accepted by the department against which SLP has filed before the Apex against in the case of Jacabo Civil Incorporated/Mitsubishi involving similar issue." 3.1 For the year under consideration, the non-resident was engaged to process three dimensional (3D) seismic data of the block NEC-DWN-2002/2 in Mahanadi Basin at its premises in UK. Seismic data indicates existence of hydrocarbons deep inside the earth and helps to identify where to drill for the same. 3.2 Ld. A.R. submits that the issue stands covered in favour of the assessee vide order passed by Hon'ble Supreme Court in assessee's own case , reported in (2015) 59 Taxman.com 01/ 376 ITR 306. 3.3 We have perused the orders passed by the authorities below, arguments advanced by both the side and the decision passed by Hon'ble Supreme Court in the assessee's own case. The only issue that arises from the grounds of appeal filed by the Revenue is in respect of the taxability of the amount paid to the non-resident / foreign companies under the contract was to be assessed u/s 44BB or 44DA of the Act. 3.4 Hon'ble Supreme Court has dealt with th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t. Regard must also be had to the fact that mineral oils is separately defined in section 3(b) of the 1957 Act to include natural gas and petroleum in respect of which the Parliament has exclusive jurisdiction under Entry 53 of List I of the 7th Schedule and had enacted an earlier legislation, i.e., Oil Fields (Regulation and Development) Act, 1948. Reading section 2 (j) and 2W) of the Mines Act, 1952 which define mines and minerals and the provisions of the Oil Fields (Regulation and Development) Act, 1948 specifically relating to prospecting and exploration of mineral oils, exhaustively referred to earlier, it is abundantly clear that drilling operations for the purpose of production of petroleum would clearly amount to a mining activity or a mining operation. 2. The facts indicate that the pith and substance of each of the contracts/agreements is inextricably' connected with prospecting, extraction or production of mineral oil. The dominant purpose of each of such agreement is for prospecting, extraction or production of mineral oils though there may be certain ancillary works contemplated thereunder. If that be so, we will have no hesitation in holding that the payments ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al production can be taken from the same. Redevelopment is the process of carrying out further development activities in an already producing field to optimize production. The non-resident rendered consultancy services in this regard under contract dated 04.07.2009 and 14.11.2008. 4.2 Ld. A.R. submits that the issue stands covered in favour of the assessee vide order passed by Hon'ble Supreme Court in assessee's own case , reported in (2015) 59 Taxman.com 01/ 376 ITR 306. 4.3 We have perused the orders passed by the authorities below, arguments advanced by both the side and the decision passed by Hon'ble Supreme Court in the assessee's own case. The assessee has received services for the purpose of activities relating to prospecting for or exploration of mineral oils. The only issue that arises from the grounds of appeal filed by the Revenue is in respect of the taxability of the amount paid to the nonresident / foreign companies under the contract was to be assessed u/s 44BB or 44DA of the Act. 4.4 Hon'ble Supreme Court has dealt with the substantial question of law relating to the assessability of the amounts paid to the non-resident u/s 44BB and have answered the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he receipts of non-resident from design, composition and implementation of multi- disciplinary teams (MDT), defining team members roles and responsibilities, developing team charters, coaching the team leads, identification of skill gaps, designing a footprint of functional excellence, providing training in the area of asset management to the MDT, assisting ONGC's executive committee in resolution of issues relating to CRC initiative etc under section 44BB of the Act, instead of Fees for Technical Services (FTS) as covered under section 9(1 )vii of the Act and duly taxed as such by the AO. 2. Whether on the facts and circumstances of the case the CIT (A) has erred in holding that the income of the assessee was taxable under the presumptive provisions of sec 44BB ignoring the fact that taxability under section 44BB shall not apply in respect of income in the nature of FTS, for a project not undertaken by the assessee, which is squarely covered under section 44DA and corroborated by clarificatory proviso to sec. 44BB and sec 44DA. 3. Whether on the facts and circumstances of the case, the CIT(A) has erred in accepting the claim of assessee regarding existence of PE in appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he issue stands covered in favour of the assessee vide order passed by Hon'ble Supreme Court in assessee's own case , reported in (2015) 59 Taxman.com 01/ 376 ITR 306. 5.3 We have perused the orders passed by the authorities below, arguments advanced by both the side and the decision passed by Hon'ble Supreme Court in the assessee's own case. It has been observed that the services received by the assessee were in relation to prospecting for or exploration of mineral oils. The issue that arises from the grounds of appeal filed by the Revenue is in respect of the taxability of the amount paid to the non-resident / foreign companies under the contract was to be assessed u/s 44BB or 44DA of the Act. 5.4 Hon'ble Supreme Court has dealt with the substantial question of law relating to the assessability of the amounts paid to the non-resident u/s 44BB and have answered the questions in favour of the assessee. 5.5 The facts relating to this appeal are identical to the facts involved in the assessee's appeal in I.T.A. No. 4652/Del/.2013 (supra), so respectfully following the same, we dismiss the ground raised by the Revenue in this appeal. Accordingly, the appeal filed by the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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