TaxTMI 
TaxTMI 
2017 (6) TMI 282
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....ssues in both the appeals are identical, therefore, both the appeals are being taken up by this consolidated order. First of all we take up the appeal of the assessee in ITA No.4877/Del/2013 as under:- 2.The assessee filed its return of income for A.Y. 2010-11 showing income of Rs. Nil by M/s ONGC Ltd. in its capacity as the representative assessee of M/s University of Calgary, Alberta, Canada. The case of the appellant was selected for scrutiny assessment by issuance of notice under section 143(2) of the Act. ONGC in the relevant A.Y., had made payments of Rs. 95,55,265/- to the M/s University of Calgary, Canada (non-resident) in terms of contract dated 23.06.2008 for long term collaboration, participation, training, maintenance of air ....
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....ces and in not holding that such receipts were taxable u/s. 44BB of the Income-tax Act, 1961. 6. In Ground No.1, the appellant contends that the receipt of the University of Calgary, Canada could not be treated as 'fees for technical services' as per India - Canada DTAA. The Ld. AR submits that as per section 90(2) of the Act, where a DTAA exists, the provisions of the Act continue to apply to be extent they are more beneficial to the assessee. In the present case, since the appellant is a non-resident it is entitled to be governed by the provisions of DTAA between India and Canada to the extent they are more beneficial to it. The Ld. AR has referred to Article 12 of India - Canada DTAA dealing with royalties and fees for include....
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....fees for included services under the India - Canada DTAA. The Ld. DR on the other hand has relied upon the orders passed by the AO and CIT(A) to support his submissions. 8.We have heard the rival submissions and perused the record of the case. The Ld. AR has relied upon the phrase (make available' appearing in Article 12(4) of the DTAA. The scope of work under the contract shows that it was a service agreement and was entered towards collaborative research, participation, training, maintenance and service for the air injection equipment of ONGC in, India. The scope of work as mentioned in the contract is extracted herein below:- "scope of work- Two U of CIT(A) professionals well visit IRS, ONGC twice per year for one week and t....
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....nd Equipment All the necessary pressure transducers ganges and thermocouples with dual readout (ie. computerized and digital analog),. SCR and Triac heater power controllers, etc. 10. Control and Data Acquisition System...... The project shall be supervised and conducted jointly by both the parties in the following manner. (a) The portion of the project which is related to the institute and to be performed by it shall be under the direction and supervision of Group General Manager Head, IRS. Dr. R. V. Marathe and General Manager-Heavy Oil Development, Mr. Sidhartha Sur. (b) The portion of the project which is required to be performed by the University shall be under the direction and supervision Drs. R.G. Moore and SA. Mehta.....
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....ness of providing services or facilities in connection with, or supplying plant and machinery on hire used, or to be used, in the prospecting for, or extraction or production of, mineral oils, a sum equal to ten per cent of the aggregate of the amounts specified in sub-section (2) shall be deemed to be the profits and gains of such business chargeable to tax under the head "Profits and gains of business or profession" : 11.Provided that this sub-section shall not apply in a case where the provisions of section 42 or section 44D or section 44DA or section 115A or section 293A apply for the purposes of computing profits or gains or any other income referred to in those sections. 12.(2) The amounts referred to in sub-section (1) shall be....
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....neral oil" includes petroleum and natural gas." The Ld. AR has relied upon the judgment passed by the Apex Court in the case of ONGC Vs. CIT, (2015) 59 Taxmann.com 1 (SC) to support his submission that the receipts are taxable under section 44BB of the Act. The Ld. DR on the other hand submitted that the services were in the nature of fee for technical services and the non-resident was not involved in extraction of oil, minerals and therefore, the provisions contained in Section 44BB of the Act do not apply. 11.We have heard the submissions. It is pertinent to note here that the appellant has no PE in India. Section 44BB of the Act applies in a case where consideration is for services relating to exploration activity which are not in ....