TaxTMI 
TaxTMI 
2011 (5) TMI 14
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.... to carry out 3D Marine Seismic Data Acquisition services in PR-OSN-2004/1 Block located in the offshore coastal areas in the states Andhra Pradesh and Tamil Nadu. The applicant states that the services rendered by it will be utilized by the Cairn in its oil exploration and production activities. It is submitted that seismic survey is the first step and most critical part of any oil and gas exploration activity. The services are part of the exploration/prospecting activities for mineral oil and falls under the ambit of section 44BB of the Income-tax Act, 1961(Act). The applicant further states that for the purposes of conducting seismic surveys, the vessel is mobilized from outside India to the site area in India where the work is to be car....
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.... in a case like this where the service provider has a Permanent Establishment in India. It is contended that the exclusion clause in Explanation 2 does not apply in the case of the applicant because it is not undertaking a mining or like project. Such project is undertaken by someone else and certain technical services are rendered by the applicant to the business enterprise that takes up the project. In short, the revenue contends that section 44BB would come into play only if the applicant goes out of the purview of section 9(1)(vii) of the Act read with Explanation 2 thereof. 4. The issue had arisen in the case of Geofizyka Torun Sp.zo.o, in AAR/813 of 2009, wherein this Authority after a detailed discussion held the view that: &nb....
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....rned Advocate on behalf of the applicant submits that section 4 of the Act provides that income tax shall be charged in respect of the total income of the previous year. Total income under section 2(45) of the Act means the total amount of income referred to in section 5 computed in the manner laid down in the Act. Unless the income is subjected to tax under section 5, it can not be computed in the manner provided in the Act. The income can be subjected to tax in India only if it accrues or arises in India or is deemed to accrue or arise in India. Thereafter, under Explanation to section 9(1)(i), income of the business in which all the operations are not carried out in India, only such part of income as is reasonably attributable to the ope....
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....f 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 in India and how much. The applicant can exercise its rights provided it opts to get the income computed under section 44BB(3) of the Act. The scheme of computation of income under this section does not provide any leeway to....