TaxTMI 
TaxTMI 
2015 (2) TMI 106
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....statutory liability, would not involve any element of service in terms of section 44BB and accordingly, the same could not be included in the total receipts for determining the presumptive income ignoring thereby provisions of section 44BB of the Act which provides for computation of the taxable income at a fixed percentage of the 'gross receipts' and also ignoring the fact the section 44BB being beneficial provision in itself, it does not envisage any further concessions to the assessee." 3. Briefly stated, the facts giving rise to this appeal are that the assessee company has been incorporated in Australia and is engaged in the business of providing equipment on hiring and manpower etc. for exploration and production of mineral o....
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....that ITAT "E" Bench, New Delhi dismissing the appeal of the revenue has upheld the order of the CIT(A) for AY 2008-09. 6. On careful consideration of above submissions and perusal of the order of the Tribunal for AY 2008-09 dated 31.8.2012 in assessee's own case in ITA No.689/D/2012 (supra), we note that the Tribunal upheld the order of the CIT(A) with following observations and conclusion:- "8. We have heard both the sides, considered the material on record and find that similar issue arose before 'G' Bench of the tribunal in the case of Sedco Forex International Drilling Inc. vs. Addl. DIT (International Taxation) in ITA No.5284/Del./2011, has decided the issue in favour of the assessee and relevant portion of the decision, which has be....
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.... heard both the parties and gone through the facts of the case as alsothe aforesaid decisions relied upon by the ld. AR. We find that Hon'ble jurisdictional High Court in their aforesaid decision Halliburton Offshore Services Inc. (supra) while adjudicating an identical issue relating to reimbursement of freight & transport charges in respect of equipment, concluded as under:- "5. Sec. 44BB provides that the deemed profits and gains under subs.(1) shall be @ 10 per cent of the aggregate amount specified in sub-s.(2). We proceed to analyze sub-s. (2). Clause (a) of sub-s. (2) refers to the amounts, (A) paid to the assessee (whether in or out of India) on account of the provision of services and facilities in connection with, or supply of pl....
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....or payable to the assessee or deemed to be received by the assessee, whereas income has been defined under s.2(24) of the IT Act and s. 5 and s. 9 deal with the income and accrued income and deemed income. Sec. 4 is the charging section of the IT Act and definition as well as the incomes referred in ss. 5 and 9 are for the purpose of imposing the income-tax under s. 143 (3). Sec.44BB is a complete code in itself. It provides by a legal fiction to be the profits and gains of the non-resident assessee engaged in the business of oil exploration @ 10 per cent of the aggregate amount specified in sub-s. (2). It is not in dispute that the amount has been received by the assessee company. Therefore, the AO added the said amount which was received ....
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....providing services or facilities in connection with, or supplying plant and machinery on higher used, or to be used, in the prospecting for, or extraction or production of, mineral oils. The amount referred in sub-s.(2) of s. 44BB are the amounts (a) paid to the assessee (whether in or out of India) on account of the provision of services and facilities in connection with, or supply of plant and machinery on higher used, or to be used, in the prospecting for, or extraction or production of, mineral oils in India, (b) payable to the assessee (whether in or out of India) on account of the provision of services and facilities in connection with, or supply of plant and machinery on higher used, or to be used, in the prospecting for, or extracti....
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.... contrary decision, we are of the opinion that service tax paid by the assessee could not form part of amount for the purpose of deemed profits u/s 44BB unlike the other amounts received towards reimbursement............." 9. Since this issue is covered by earlier decision of ITAT, 'G' Bench, Delhi, which is on similar point and no contrary or any higher courts' precedent has been cited, therefore, while following the said decision, we uphold the order of Ld.CIT(A) and dismiss the present appeal." 7. From operative part of the impugned order of the CIT(A) for AY 2009- 10, we observe that the CIT(A) has granted relief for the assessee with following determination:- "Determination: 4.0 The appellant has submitted that service tax collecte....