R&B Falcon (A) Pty Ltd., New Delhi V. Addl. DIT, Dehradun

ITA 1215/DEL/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 7485 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 2 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-06-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 04-04-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 04-03-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: IN LAW
• Section: 143(3)

Judgement Text

INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F : NEW DELHI BEFORE SHRI H S SIDHU JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO.:- 1215/DEL /2014 ASSESSMENT YEAR: 2010-11 R & B FALCON ( A) PTY LIMITED C/O NANGIA & CO SUIT NO 4A, PLAZA M-6 JASOLA NEW DELHI 110025 PAN AACCR5345Q VS. ADDL. DIT INTERNATIONAL TAXATION INCOME TAX OFFICE SUBHASH ROAD DEHRADUN 2480001 (APPELLANT) (RESPONDENT) O R D E R PER PRASHANT MAHARISHI, A. M. 1. THIS IS APPEAL FILED BY THE ASSESSEE AGAINST THE OR DER OF THE COMMISSIONER OF INCOME TAX (APPEALS) II, DEHRADUN DATED 19 TH OF DECEMBER 2013 RAISING THE SOLITARY GROUND OF APPEAL THAT LEARNED CIT (A) HAS ADDED ON FACTS AND IN LAW BY AFFIRMING TO THE ACTION OF THE ASSESSING OFF ICER IN HOLDING THAT THE AMOUNTS AGGREGATING TO RS. 225347824/- RECEIVED BY THE APPELLANT FROM ITS CUSTOMERS AS REIMBURSEMENT OF ACTUAL EXPENSES INCUR RED BY THE APPELLANT ON THEIR BEHALF, IS TO BE INCLUDED IN THE GROSS REC EIPTS U/S 44BB OF THE INCOME TAX ACT 1961. 2. THE BRIEF FACTS OF THE CASE ARE THAT APPELLANT I S A COMPANY INCORPORATED UNDER THE LAWS OF AUSTRALIA HAVING ITS REGISTERED O FFICE AT PERTH AUSTRALIA. THE INDIAN PROJECT OFFERS IS AT MUMBAI. THE ASSES SEE IS ENGAGED IN THE BUSINESS OF PERFORMING DRILLING OPERATIONS THROUGH THE PROVISIONS OF RIGS AND INTEGRATED SERVICES IN CONNECTION WITH EXPLORATION AND EXPLOITATION AND PRODUCTION OF MINERAL OIL IN INDIA. THE ASSESSEE IS FILING RETURN OF INCOME OFFERING ITS INCOME UNDER THE PROVISIONS OF SECTION 44BB OF THE INCOME TAX ASSESSEE BY : CA. AMIT ARRORA RESPONDENT BY: MR. ANUJ ARRORA CIT DR DATE OF HEARING 04/04/2016 DATE OF PRONOUNCEMENT 03 /06/2016 PAGE 2 OF 3 ACT. FOR ASSESSMENT YEAR 2010 11 IT FILED ITS RE TURN OF INCOME ON FORCED OCTOBER 2010 DECLARING TOTAL INCOME OF RS. 32361384 7/-. IN THE RETURN OF INCOME, ASSESSEE HAS CLAIMED THAT RS. 225347824/- R ECEIVED ON ACCOUNT OF REIMBURSEMENT OF SUPPLY OF MATERIAL AND FUEL RECHAR GE WERE NOT CHARGEABLE TO TAX. LD. ASSESSING OFFICERS PASSED AN ASSESSMENT UNDER SECTION 143(3) ALL BOTH OCTOBER 2012 INCLUDING THIS AMOUNT BECAUSE OF REIMBURSEMENT UNDER THE PROVISIONS OF SECTION 44 BB OF THE ACT. APPELLA NT PREFERRED ON APPEAL BEFORE THE COMMISSIONER OF INCOME TAX APPEALS VARIE D BY ORDER DATED 19 TH OF DECEMBER 2013 DISMISSED THE CLAIM OF THE CLAIM OF T HE APPELLANT. THEREFORE, ASSESSEE IS IN APPEAL BEFORE US. 3. LEARNED AR OF THE APPELLANT SUBMITTED THAT THE ISSU E IS SQUARELY COVERED BY THE DECISION OF COORDINATE BENCH IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2009 10. HE PLACED ON RECORD THE COPY OF THE DECI SION IN IT NO. 505/DES/2013 DATED 16 AUGUST 2013. HE REFERRED TO PARA NO. 4 OF THAT JUDGMENT WHEREIN THE COORDINATE BENCH RELYING ON TH E DECISION IS OF HONBLE JURISDICTIONAL HIGH COURT OF UTTARAKHAND IN CASE OF HALIBURTON OFFSHORE SERVICES INCORPORATION [300 ITR 265] HAS HELD THAT IT ALL RECEIPTS WHICH ARE INTRICATELY LINKED THE SERVICES RENDERED BY THE ASS ESSEE IS TO BE CONSIDERED AS A PART OF THE RECEIPT FOR THE PURPOSES OF COMPUT ATION OF INCOME USELESS AS 44BB OF THE INCOME TAX ACT. 4. LEARNED DR ALSO AGREED WITH THE ABOVE PROPOSITION A ND SUBMITTED THAT THIS ISSUE IS SQUARELY COVERED AGAINST THE ASSESSEE IN I TS OWN CASE BY DECISION OF THE COORDINATE BENCH FOR ASSESSMENT YEAR 2009 201 0. 5. WE HAVE CAREFULLY CONSIDERED THE RIVAL CONTENTIONS AND WE HAVE ALSO PRODUCED THE DECISION OF COORDINATE BENCH IN CASE O F THE ASSESSEE ITSELF FOR ASSESSMENT YEAR 2009- 2010 WHEREIN THIS ISSUE HAS ALREADY BEEN DECIDED AGAINST THE ASSESSING AS UNDER:- 4. THE ASSESSEES REPRESENTATIVE SUBMITTED THAT THE ASSESSEE HAS PREFERRED AN APPEAL BEFORE THE JURISDICTIONAL HIGH COURT OF UTTARAKHAND IN THIS REGARD BUT HE FAIRLY CONCEDED THAT THE ORDE R OF COORDINATE BENCH OF THE TRIBUNAL STILL HOLDS FIELD BECAUSE THE SAME HAS NOT BEEN SET ASIDE OR MODIFIED BY THE HONBLE HIGHER APPELLATE FORUM T ILL DATE. IN VIEW OF ABOVE, WE OBSERVE THAT THE PRESENT CASE IS ALSO SQU ARELY COVERED BY THE ABOVE JUDGMENT OF ITAT DELHI FBENCH DATED 27.4.20 12 IN ITA NO. 5287/DEL/2011 FOR AY 2008-09 (SUPRA) AND THE SOLE G ROUND OF THE ASSESSEE DESERVES TO BE DECIDED AGAINST THE ASSESSE E. THE ASSESSEES REPRESENTATIVE HAS PLACED HIS RELIANCE ON THE JUDGM ENT OF HONBLE JURISDICTIONAL HIGH COURT OF UTTARAKHAND IN THE CAS E OF HALIBURTON PAGE 3 OF 3 OFFSHORE SERVICE INC (2008) 300 ITR 265 (UTTARAKHAN D) WHEREIN IT HAS BEEN HELD THAT THE AGGREGATE AMOUNT RECEIVED BY NON -RESIDENT ASSESSEE IS CHARGEABLE TO TAX U/S 44BB OF THE ACT AT 10% WIT HOUT ANY DEDUCTION LIKE FREIGHT AND TRANSPORTATION CHARGES. THE LD. DR CONTENDED THAT THE HONBLE HIGH COURT OF UTTARAKHAND HAS CONSIDERED TH E SCHEME OF PRESUMPTIVE DETERMINATION U/S 44BB OF THE ACT AND H AS HELD THAT THIS SECTION IS A COMPLETE CODE IN ITSELF AND PROVIDES F OR TAXATION OF ALL RECEIPTS WHETHER ARISING IN INDIA OR OUTSIDE. THUS, FOR THE PURPOSE OF PRESUMPTIVE DETERMINATION OF ASSESSEES PROFITS, QU ANTUM OF AMOUNT RECEIVED BY IT FROM ITS CUSTOMERS AGAINST ITS REIMB URSEMENT OF FUEL AND MATERIAL RECHARGE, WHICH ARE INTRICATELY LINKED TO THE SERVICES WERE RENDERED BY THE ASSESSEE AND INCURRED BY IT, HAS TO BE CONSIDERED AS A PART OF THE RECEIPT FOR THE PURPOSES OF COMPUTATION OF INCOME U/S 44B (SIC. 44BB) OF THE ACT. 5. IN THE LIGHT OF DISCUSSIONS MADE HEREINABOVE AND WHEN THE LD. AR ACCEPTED THE POSITION THAT THE ISSUE IS SQUARELY CO VERED BY THE AFORESAID DECISION WHILE NO OTHER CONTRARY DECISION WAS BROUGHT TO OUR NOTICE NOR LD. AR PLACED ANY CONTRARY MATERIAL BEFO RE US CONTROVERTING THE AFORESAID FINDINGS OF THE ASSESSING OFFICER, WE HAVE NO HESITATION IN UPHOLDING THE FINDINGS OF THE ASSESSING OFFICER. IN VIEW OF ABOVE FACTS AND DECISION OF THE COORDINA TE BENCH IN CASE OF THE ASSESSEE FOR PREVIOUS YEAR WE CONFIRM THE FINDING O F THE LD. CIT (A) IN HOLDING THAT REIMBURSEMENT OF RS. 225347824/- RECEI VED BY THE APPELLANT FROM ITS CUSTOMERS AS REIMBURSEMENT OF ACTUAL EXPEN SES INCURRED BY THE APPELLANT ON THEIR BEHALF IS TO BE INCLUDED IN THE GROSS RECEIPTS UNDER SECTION 44BB OF THE INCOME TAX ACT 1961. 6. IN THE RESULT THE SOLITARY GROUND OF THE APPEAL IS DISMISSED ORDER PRONOUNCED IN THE OPEN COURT ON 03 /06/2016 . SD/- SD/- ( H. S. SIDHU) (PRASHANT MAHARISHI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 03 /06/2016 A K KEOT COPY FORWARDED TO 1. APPLICANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI