TaxTMI 
TaxTMI 
2016 (10) TMI 1053
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.... of the case, the CIT (A) has erred in holding that the nature of services provided by the assessee were not in the nature of fees for technical services as defined in sec. 9(l)(vii) of the Act. 2. Whether on the facts and circumstances of the case, the CIT (A) has erred in holding that the income of the assessee was not taxable under the provisions of section 44DA r.w.s 115A even through the nature of services rendered by the assessee were technical in nature. 3. Whether on the facts and circumstances of the case, the CIT (A) has erred in holding that the income of the assessee was taxable under the presumptive provision of section 44BB and ignoring the fact that taxability u/s. 44BB shall not apply in respect of income referred to in section 44DA in view of the clarificatory proviso to sec. 44BB and sec. 44DA. 4. Whether on the facts and circumstances of the case, the CIT (A) has erred in not appreciating the fact that proviso to section 44DA brought about by the Finance Act, 2011 was only clarificatory in nature and its application has to be read in to the main provisions with effect from time the time, the main provision came in to effect in view of t....
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....in holding that interest under section 234B was not chargeable in this case by relying upon the decision of Hon'ble Uttarakhand High Court in the case of Maersk (334 ITR 79) where as the department has contested the issue and has filed SLP before the APEX Court against in the case the Jacobs Civil Incorporated/Mitsubishi involving similar issue." D I.T.A. No. 5911/Del/2012 (Assessee's Appeal for A.Y. 2009-10): "The under mentioned grounds of appeal are without prejudice to one another. (1) That there was no justification on the part of the Ld. AO in disallowing part of the material cost amounting to Rs. 10,02,689/- and at any rate, without prejudice, the disallowance as made is very excessive. (2) That the Dispute Resolution Panel (DRP)/AO had erred in disallowing the provisions of expenses amounting to Rs. 85,32,43,703/- against the claim of ONGC. At any rate, without prejudice, the disallowance as made is very excessive inasmuch as DRP/AO had ignored submissions made by the Appellant for applying section-44BB of the Act without prejudice to the main submissions in consequence whereof the total income assessed is more than provisions contained....
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....006 declaring an income of Rs. 189,204,042/- by taking total revenue from contracts executed in India and has offered the same u/s. 44BB of the Income tax act. 3.3 Assessee was of the belief that as it had earned revenue from procurement of materials outside India for RSPPM project, which had arisen from outside India activities the same was not subject to tax in view of ruling in Ishikawajima Harima Heavy Industries 288 ITR 408 and not attributable to Permanent Establishment. 3.4 During the course of assessment, assessee submitted that outside operating revenue not to be subjected to tax in view of the Hon'ble Supreme Court decision, although in the Return of Income, appellant had offered entire revenue i.e. Inside and Outside India. Ld. AO accepted the contention of the assessee and relying upon the decision of Supreme Court treated the income earned outside as exempt from Tax. Assessment for the aforesaid return of A.Y 05-06 was completed under section 143(3) of the act vide order dated 30th March 2007 (hereafter referred to as "original assessment") assessing the income on deemed basis under section 44BB at Rs. 2,35,95,260/-. 3.5 Subsequently, AO has issued the not....
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....ident, not being a company, or a foreign company, after 1st April, 2004 and section 115A deals with technical service fees in case of a foreign company. Therefore it cannot be concluded that income received by an non-resident assessee for providing services or facilities in the prospecting for, or extraction or production of mineral oils would be covered by section 44D or 44DA for those assessment years before insertion of Proviso to subsection (1) of section 44 BB was inserted." 5.2 Moreover, we find that Hon'ble Supreme Court in the case of ONGC Ltd. v. CIT, 2015 (7) TMI 91 has set at rest the entire controversy by holding that provisions of various services in connection with the prospecting for, or extraction or production of mineral oils, is taxable on presumptive basis u/s. 44BB of the Act. The services carried on by assessee are in connection with the prospecting for mineral oils and, therefore, following the decision of Hon'ble Supreme Court, the findings of Ld. CIT (A) are upheld. 5.3 In the decision, Hon'ble Supreme Court has held that, where the dominant purpose of agreement is for prospecting, extraction or production of mineral oil, though there may b....
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....by way of royalty or fees for technical services other than income referred to in sub-section (1) of section 44DA" for words "a foreign company, includes any income by way of royalty or fees for technical services". Therefore, w.e.f 1.4.2004 fee for technical services which is not connected with permanent establishment of business or fixed place of profession in India, will be taxable u/s. 115A(l)(b) of the Act. As observed earlier section 44DA was inserted in proviso to section 44BB(1) by the Finance Act, 2010 with effect from 1.4.2011 and simultaneously inserted second proviso to section 44DA applicable from assessment year 2011-12 according to which provisions of section 44BB(1) will not be applicable in respect of income referred to this section. On combined reading of proviso to section 44BB(1) and second proviso to section 44DA-It is clear that the fee for technical services rendered in connection with prospecting for or extraction or production of mineral oil though effectively connected with PE or fixed place of profession will fall not under section 44BB(1) and will be assessable under section 44DA of the Act. To make it more clear the fee for technical services can be div....
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....al raised by the assessee stands dismissed. Ground No. 2: 8. The issue raised by the assessee in ground No. 2 is regarding the revenue and alleged to have been earned outside India which were not offered to tax by the assessee, as the same were attributable to activity outside India. 8.1 This view of the assessee cannot be accepted as the entire payment was received by the assessee for execution of the contract in India. We agree with the findings of the Ld. CIT(A) that the issue now stands settled with the decision of Hon'ble Uttarakhand High Court in the case of Sedco Forex Intl. Inc. v. CIT [2008] 299 ITR 238. It is neither the case of the assessee that separate payments are being made for various services rendered by the assessee, nor is the case that separate parts of the contract are executed at different places, as it was in the case of Ishikawajma Harima Heavy Industries Ltd. v. DIT [2007] 288 ITR 408. We are therefore of the considered view that the ratio laid down by Hon'ble Supreme Court in Ishikawajma Harima Heavy Industries Ltd. (supra) cannot be applied to the facts of the present case before us. 8.2 As we have held while deciding the appeal raised....