TMI Blog2011 (7) TMI 1342X X X X Extracts X X X X X X X X Extracts X X X X ..... mation of sub-surface. The required data is collected on large storage tapes and then processed by specialist professionals with the help of specialized equipments to present the sub-surface data in a manner that can help geologist draw conclusions about existence of hydro-carbon in the areas. The applicant submits that it has entered into a contract with BHP Billiton Petroleum (International Exploration) Pty. Ltd. (BHP Billiton), a company incorporated under the laws of Australia. The contract relates to carrying out 2D marine seismic data acquisition and processing services in oil and gas blocks located some 350 km south-west of Mumbai and 300 km north-west of Cochin off shore, the west coast of India. 2. Applicant submits that section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Torun Sp. zo. O.. In re [2010] 186 Taxman 213 and in Seabird Exploration FZ LLC, In re [2010] 187 Taxman 37 , wherein it has been held that the services of data acquisition and processing are covered under the provisions of section 44BB of the Act. 3. On the basis of above facts the applicant desires to obtain a ruling on the following questions - 1.Whether revenues to be earned by the Applicant under the seismic data acquisition and processing contract with BHP Billiton in India are taxable in accordance with section 44BB of the Income-tax Act, 1961 (Act)? 2.Whether the revenues arising under the contract with BHP Billiton on account of mobilization/demobilization activities attributable to distance travelled by the vessel outsi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sition and processing of 2D and 3D seismic data are covered under section 9(1)(vii ) of the Act as the receipts are to be examined under sections 5 and 9 of the Act. The presumptive sections are neither charging section nor do they elaborate the nature of income in the hands of the assessee. The revenue contends that the entire mobilization/demobilization revenues should be included in the 'gross receipts' for the purposes of taxation in view of the decisions in the cases of CIT v. Atwood Oceanics Pacific Ltd.[2010] 8 taxmann.com 177 /[2011] 196 Taxman 325 (Uttarakhand), CIT v. R B Falcon Drilling Co.[2009] 181 Taxman 62 (Uttarakhand) and CIT v. Sundowner Offshore International (Burmuda) Ltd.[2009] 183 Taxman 365 (Uttarakhand). 5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sp. zo. O's case (supra). The issued raised by the revenue have been discussed at length in the said ruling. Regarding the Revenue's contention that the provisions of section 44BB would not apply in view of insertion of section 44DA by the Finance Act, 2010 with effect from 1-4-2011, it is pointed out that section 44DA applies where royalty or fees for technical services is received by a foreign company in pursuance of an agreement with an Indian concern, whereas in the present case the parties involved are two foreign companies. This we are saying without addressing the question whether the receipts in the hands of the applicant qualifies as fees for technical services, as we find that the services provided by the applicant are not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the receipts are held to be in a nature of fees for technical services. 7. Once an assessee opts to come under section 44BB(1) of the Act, the provision itself deems its profits and gains as 10 per cent of the aggregate of the amounts specified in sub-section (2). Sub-section (2)(a) specifies that that aggregate amount is the amount paid or payable whether in or out of India to the assessee on account of provision of services in India. In the scenario, there is no scope for splitting up the amount payable to the assessee. If the assessee wants to seek such a splitting up it has to go under section 44BB(3) of the Act. 8. Section 44BB does not close its doors to an applicant who desires to know which part of its income accrues or arises ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
