TaxTMI 
TaxTMI 
TaxTMI 
2025 (10) TMI 944
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....071372618(1), dated 19.12.2024, passed u/s. 144C(5) of the Income-tax Act, 1961 (hereinafter referred to as the "Act"), for Assessment Year 2022-2023. 2. Grounds taken by the Assessee are reproduced as under: "(1) On the facts and in the circumstances of the case and in law, the learned Deputy Commissioner of Income Tax (International tax) 1(1)(2), Mumbai [DCTT(IT)] and Hon'ble Dispute Resolution Panel-1 (DRP) erred in denying the benefit of Article 8 of the Double Taxation Avoidance Agreement between India and UAE (Tax Treaty) on the shipping income [including inland haulage charges (IHC)] derived from operation of ships in international traffic. (2) On the facts and in the circumstances of the case and in law, the....
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....n law, the learned DCTT(IT) and Hon'ble DRP erred in denying the benefit of Article 8(2)(b) of the India-UAE Tax Treaty without appreciating that the income earned is derived from the rental of containers and used in connection with the Appellant's operation of ships international traffic covered under Article 8(2)(b) of the India- UAE Tax Treaty as per which they are not taxable in India. (7). On the facts and in the circumstances of the case and in law, the learned DCIT(IT) and land Haulage Charges of Rs. 20,37.59,089 earned by the Appellant and taxing the same at 10% as per Rule 10 of Income-tax Rules, 1962. (8). On the facts and in the circumstances of the case and in law, the learned DCTT(IT) and Hon'ble D....
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....Act without appreciating that the Appellant has not under-reported any income." 3. Assessee has raised as many as 12 grounds. However, ground No. 4, 5 and 6, all relate to one issue in respect of denying the benefit of Article 8 under India-UAE Double Taxation Avoidance Agreement (DTAA) and holding it liable to be taxed in India u/s.44B in respect of shipping income of Rs. 43,58,36,295/-, derived from operation of ships in international traffic. Ground No.7 deals with denial of benefit under Article 8 of the same treaty of Inland Haulage Charges (IHC) of Rs. 20,37,59,089/-. 3.1. Both the above stated issues are squarely covered by the decisions of the Co-ordinate Bench in assessee's own case for A.Y.2016-17 in ITA No. No.7113/Mum/2019....
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....rom India involving hundreds of ships voyages with ships of different names and charterers. While rejecting the claim of the assessee, ld. AO in his draft assessment order passed u/s.144C(1) noted in para 4.6 that similar addition have been upheld by ld. DRP in its directions in the case of the assessee for A.Y.2016-17, 2017-18 and 2018-19. He made reference to these assessment years which travelled up to the Co-ordinate Bench and findings were held in favour of the assessee. 5.1. Before the ld. DRP, assessee made detailed submissions raising its objections. On both the issues dealt in ground no. 4, 5, 6 and 7 of the present appeal, ld. DRP observed that the years involved had come up for directions in A.Y.2017-18 and on the basis of tho....
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....f accordingly." 6.1. In respect of inland haulage charges referred in ground No.7 of the present appeal, we refer to the decision of the Co-ordinate Bench for A.Y.2017-18 (supra) which held that these charges are inextricably linked to shipping business in international traffic. According to the Co-ordinate Bench, activity of shipping a container from inland to the port for further shipping in international traffic, is an integral part of operation of ships which cannot be disintegrated from profit derived from shipping business as envisaged under Article 8 of India-UAE DTAA. It was thus, held that it is not taxable as business profit in India. Relevant para from the said decision is extracted below:- "15. The Hon'ble Jurisd....