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of <h1>Non-resident income tax appeal dismissed, computation under section 44BB upheld. Tribunal justified in not referring question of law.</h1> <h3>Commissioner of Income Tax Versus Oil And Natural Gas Commission.</h3> Commissioner of Income Tax Versus Oil And Natural Gas Commission. - [2002] 255 ITR 413, 172 CTR 297, 124 TAXMANN 292 Issues Involved:1. Validity of the Income-tax Appellate Tribunal's order u/s 263.2. Inclusion of income-tax payable by ONGC on behalf of CGG in the total income u/s 44BB.Summary of Judgment:Issue 1: Validity of the Income-tax Appellate Tribunal's order u/s 263The court examined whether the Income-tax Appellate Tribunal was justified in quashing the order passed by the Commissioner of Income-tax u/s 263. The Tribunal had set aside the Commissioner's order and ruled in favor of the assessee, ONGC, acting as an agent for the non-resident assessee, CGG. The Tribunal's decision was based on the premise that the computation of income for the non-resident assessee should be made exclusively u/s 44BB, which provides a special method for computing profits and gains from the business of exploration of mineral oils, overriding sections 28 to 41 and sections 43 and 43A.Issue 2: Inclusion of income-tax payable by ONGC on behalf of CGG in the total income u/s 44BBThe court considered whether the amount of income-tax payable by ONGC on behalf of CGG should be included in the total income of the assessee. The Commissioner of Income-tax had directed the Assessing Officer to include the entire receipt of the income-tax payable by the company in India as part of the income from profits and gains of business falling u/s 28(iv). However, the Tribunal upheld the assessee's contention that the computation of income should be made solely u/s 44BB, which includes only 10% of the aggregate amounts specified in sub-section (2) of section 44BB. The court agreed with the Tribunal, stating that section 44BB provides a complete code for computing income from the business of exploration of mineral oils for non-residents, excluding the applicability of section 28(iv).Conclusion:The court dismissed the Income-tax Appeals Nos. 67 of 2001, 68 of 2001, and 71 of 2001, upholding the Tribunal's decision that the computation of income for the non-resident assessee should be made exclusively u/s 44BB. The court also rejected the reference applications u/s 256(2), affirming that the Tribunal was justified in not referring the question of law to the court, as the answer was self-evident from the scheme of the Act and the reading of the provision itself.
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