2019 (7) TMI 123

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....ctions of the Dispute Resolution Panel-I (DRP), Mumbai. 2. Ground no.1, being general in nature does not require adjudication, hence, dismissed. 3. In grounds no.2, 3 and 4, the assessee has called into question the taxability of freight charges of Rs. 30,34,08,701, from transportation of cargo through Feeder Vessels. 4. Brief facts as culled out from the record are, the assessee company, a tax resident of Germany, is engaged in the business of transportation of cargo to Ports in various countries including India. Generally, the assessee transports cargo on vessels owned, chartered, pooled by it as well as on slot arrangement. Sometimes, it so happens that the vessels of the assessee cannot call at the Indian Ports on account of various....

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....aty. The Assessing Officer, however, did not find merit in the submissions of the assessee. Relying upon the observations made in the assessment order passed for the assessment year 2007-08, the Assessing Officer ultimately held that the freight charges received from feeder vessels is taxable in India both under section 44B of the Act as well as Article8 of the India-Germany Tax Treaty. He observed, the income earned by the assessee from feeder vessels will not qualify for exemption under Article-8 of the India Germany Tax Treaty. Accordingly, he brought to tax the amount under dispute. Further, the Assessing Officer held that the assessee has a PE in India as per Article-5 of the India Germany Tax Treaty. 5. Being aggrieved with the afore....

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....ipt from feeder vessels is not taxable as per Article-8 of the India-Germany Tax Treaty. In the latest order passed for the assessment year 2013-14 in ITA no.1441/Mum./2017, dated 31st October 2017, the Tribunal following its earlier decision has held as under:- "16. We are of the considered view that as we have concluded that the benefit of Article 8 of the India-Germany DTAA would also be available to the assessee in respect of the revenue earned by it from the feeder vessels obtained on slot hire arrangements, therefore, the Grounds of appeal nos.5 to 7 pertaining to the validity of the order of the A.O. as regards including the service tax in the freight income for computing the income of the assessee under Sec.44B would be rendered i....