Regular shipping business outside section 172(4), with income left to be assessed under the normal tax framework.

Section 172(4) could not be applied where the non-resident shipping activity was not merely occasional and the assessee was already filing returns under section 139(1) and being assessed under section 44B. On those facts, the matter fell within the regular assessment framework, and the Tribunal accepted that section 172(4) was not sustainable. It also noted that the Assessing Officer could examine the position and, if warranted, proceed under section 172(7) so that income from the voyages was brought to tax under the normal provisions.

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Issues: Whether the assessee was liable to be assessed under section 172(4) of the Income-tax Act, 1961, or whether the case fell within section 172(7) read with the normal provisions of the Act because the shipping activity was regular and not occasional.

Analysis: The assessee had filed returns under section 139(1) and was already being assessed under section 44B, which supported the finding that it was engaged in regular shipping business. The Tribunal followed its earlier decision on identical facts and held that section 172(4) could not be sustained where the non-resident was not being treated as engaged only in occasional shipping business. At the same time, it noted that the jurisdictional Assessing Officer could verify the position and take action, if warranted, under section 172(7) so that income from the voyages did not escape assessment under the normal provisions.

Conclusion: The assessment under section 172(4) was not sustained and the Revenue's challenge failed; the assessee's position that the matter lay in the regular assessment framework was accepted.

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