TaxTMI 
TaxTMI 
2012 (2) TMI 75
X X X X Extracts X X X X
X X X X Extracts X X X X
....as made on 6.3.2009. Petronet awarded the contract for the project to the consortium which was amended and reinstated on 17.11.2009. Under the contract, the consortium members are to undertake the designing, engineering, procurement of equipment, material supplies to erect, construct, test and commission and turn over the facilities for the storage and regasification of liquefied natural gas to Petronet. 2. As per the terms of the contract, CTCI is responsible for offshore supplies, offshore services and mandatory spares (for offshore supplies). CINDA is responsible for onshore supplies, onshore services, construction and erection and machinery spares (for onshore supplies). 3. It is in the context of these contracts that the applicant ap....
X X X X Extracts X X X X
X X X X Extracts X X X X
....e decision in IHHI does not apply to the facts of the case as CTCI is a resident of Hong Kong with whom there is no agreement under section 90(2) of the Act by the Government of India and the Government of Hong Kong. The taxability of the receipts in the hands of the CTCI would be governed under section 9(1)(i) read with Explanation 2(b) to section 9(1) of the Income-tax Act, 1961 (Act). The consortium partner CINDA will constitute business connection of CTCI in India and CTCI is responsible for whole of the contract alongwith CINDA. 6. Referring to various clauses of the contract read with Consortium agreement, the learned counsel refuted the Revenue's claim that as the role and responsibilities of each of the members of the consortium is....
X X X X Extracts X X X X
X X X X Extracts X X X X
....g City, 33, Canton Road, Tism Sha Tsui, Kowloon, Hong Kong. The Taiwan address is not that of CTCI but is that of the supplier of goods to Petronet. As the supplier of offshore supplies is not the applicant but a third party to whom the payment is made by Petronet, the commercial arrangement between them in respect of the supplies is required to be examined from the angle whether it has given rise to an income in the hands of CTCI or not. 8. The question raised before us is about income received by the applicant on offshore supplies from Petronet. What we find is that no payment is made to the applicant. The payment is made in the bank in Taiwan on the basis of bill submitted by the Supplier (Holding Company) and not by the applicant. Ther....
X X X X Extracts X X X X
X X X X Extracts X X X X
....OP as also in terms of Explanation 2(b) to section 9(1)(i) of the Act since it is providing offshore supplies. We notice that under section 2(31) of the Act, the consortium of CINDA and CTCI forms an Association Of Persons (AOP) to carry out the project awarded by Petronet. Whether the consortium's object is to derive profit or share the profit in a particular manner is not relevant in view of the fiction created under the Explanation to section 2(31) of the Act. The responsibilities of the consortium members mentioned under the terms of the contract would also not affect conferring AOP status to the consortium in view of the formation of a consortium by CINDA and CTCI. That being so, the applicant can be said to have a business connection ....