Grant Geophysical Intl' Inc., Dehradun V. ADIT, Dehradun

ITA 4407/DEL/2011

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 74290 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 5 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-03-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 25-02-2014
• Assessment Year: 2008-2009
• Appeal Filed On: 04-10-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SATPAL SINGH
• Assessee Lawyers: DR RAKESH GUPTA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI BENCH BENCH BENCH BENCH C CC C : NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G. BEFORE SHRI G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND VICE PRESIDENT AND SHRI SHRI SHRI SHRI CHANDRA MOHAN GARG CHANDRA MOHAN GARG CHANDRA MOHAN GARG CHANDRA MOHAN GARG, ,, , JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER ITA NO ITA NO ITA NO ITA NO. .. .4407/DEL/2011 4407/DEL/2011 4407/DEL/2011 4407/DEL/2011 ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR ASSESSMENT YEAR : : : : 2008 2008 2008 2008- -- -09 0909 09 M/S GRANT GEOPHYSICAL M/S GRANT GEOPHYSICAL M/S GRANT GEOPHYSICAL M/S GRANT GEOPHYSICAL INTLINC., INTLINC., INTLINC., INTLINC., C/O MATTA SUDHIR & C/O MATTA SUDHIR & C/O MATTA SUDHIR & C/O MATTA SUDHIR & CO., CO., CO., CO., 15, ASTLEY HALL, 15, ASTLEY HALL, 15, ASTLEY HALL, 15, ASTLEY HALL, DEHRADUN. DEHRADUN. DEHRADUN. DEHRADUN. PAN : PAN : PAN : PAN : AABCG7507Q. AABCG7507Q. AABCG7507Q. AABCG7507Q. VS. VS. VS. VS. ASSISTANT DIRECTOR OF INCOME TAX, ASSISTANT DIRECTOR OF INCOME TAX, ASSISTANT DIRECTOR OF INCOME TAX, ASSISTANT DIRECTOR OF INCOME TAX, INTERNATIONAL TAXATION, INTERNATIONAL TAXATION, INTERNATIONAL TAXATION, INTERNATIONAL TAXATION, DEHRADUN. DEHRADUN. DEHRADUN. DEHRADUN. (APPELLANT) (RESPONDENT) APPELLANT BY : DR. RAKESH GUPTA, FCA AND SHRI SOMIL AGARWAL, CA. RESPONDENT BY : SHRI SATPAL SINGH, SR.DR. ORDER ORDER ORDER ORDER PER G. PER G. PER G. PER G.D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, D.AGRAWAL, VP VPVP VP : : : : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E DIRECTIONS OF LEARNED DISPUTE RESOLUTION PANEL-II, DELHI DATED 16 TH AUGUST, 2011 FOR THE ASSESSMENT YEAR 2008-09. 2. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS:- 1. THE LEARNED ASSESSING OFFICER HAS PASSED THE DR AFT ASSESSMENT ORDER WITHOUT ALLOWING PROPER AND REASON ABLE TIME AND OPPORTUNITY. 2. THE LEARNED ASSESSING OFFICER AS ALSO DISPUTE RESOLUTION PANEL (DRP) HAVE ERRED IN LAW AND FACTS OF THE CASE IN TREATING THE REVENUES ARISING ON ACCOUNT OF SEISMIC SERVICE RENDERED AS ALSO REIMBURSEMENT OF EXPENSES AS FEES FOR TECHNICAL SERVICES U/S 9(1)(VII) OF THE INCOME TAX ACT, 1961 AGAINST THE CLAIM OF THE ASSESSEE OF ASSE SSMENT OF INCOME U/S 44BB OF THE INCOME TAX ACT, 1961. 3. THE LEARNED ASSESSING OFFICER AS ALSO LEARNED DR P HAVE WRONGLY AND ARBITRARILY APPLIED THE DEEMED PRO FIT RATE ITA-4407/DEL/2011 2 OF 25% ON THE GROSS RECEIPTS (INCLUDING REIMBURSEME NT OF EXPENSES) IN ARRIVING AT ASSESSMENT OF INCOME UNDER FEES FOR TECHNICAL SERVICES WITHOUT ANY BASIS OR AUTHOR ITY AS PER PROVISIONS OF LAW. 4. THE ORDERS PASSED ARE ARBITRARY, AGAINST THE PROVISIONS OF LAW AND FACTS OF THE CASE. 5. THE APPELLANT RESERVES THE RIGHT TO RAISE ANY OT HER GROUND OF APPEAL BEFORE OR DURING THE COURSE OF HEA RING OF APPEAL. 3. AT THE TIME OF HEARING BEFORE US, THE ASSESSEES COUNSEL SUBMITTED THAT THE ISSUE IS SQUARELY COVERED IN FAV OUR OF THE ASSESSEE BY THE DECISION OF ITAT IN ASSESSEES OWN CASE FOR AY 2004-05 AND 2009-10 VIDE ITA NOS.4181/DEL/2012 & 4182/DEL/2012. HE, THEREFORE, SUBMITTED THAT THE ASSESSING OFFICER MAY BE DIRECTE D TO COMPLETE THE ASSESSMENT UNDER SECTION 44BB OF THE INCOME-TAX ACT , 1961. 4. LEARNED DR, ON THE OTHER HAND, RELIED UPON THE O RDERS OF LOWER AUTHORITIES. 5. WE HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AN D PERUSED RELEVANT MATERIAL PLACED BEFORE US. WE FIND THAT T HE ASSESSEE DERIVES INCOME FROM A CONTRACT WITH M/S CAIRN ENERGY INDIA P.LTD. FOR ONSHORE 2D SEISMIC DATA ACQUISITION AND PROCESSING SERVICES . THE ASSESSING OFFICER TREATED THE REVENUE AS FEES FOR TECHNICAL S ERVICES WHILE THE CLAIM OF THE ASSESSEE WAS THAT IT SHOULD BE ASSESSE D UNDER SECTION 44BB. WE FIND THAT IDENTICAL ISSUE HAS BEEN CONSID ERED BY THE ITAT IN ASSESSEES OWN CASE FOR AY 2004-05 AS WELL AS 2009- 10. IN BOTH THE YEARS, UNDER SIMILAR CIRCUMSTANCES, THE REVENUE HAS ASSESSED THE CONTRACT RECEIPT AS FEES FOR TECHNICAL SERVICES. L EARNED CIT(A), IN THOSE YEARS, ACCEPTED THE ASSESSEES CONTENTION AND DIREC TED THAT THE INCOME BE ASSESSED UNDER SECTION 44BB AND NOT AS FE ES FOR TECHNICAL SERVICES. ON APPEAL, THE ITAT, VIDE ORDER DATED 18 TH SEPTEMBER, 2013 IN ITA NOS.4181/DEL/2012 & 4182/DEL/2012, UPHELD TH E ORDER OF ITA-4407/DEL/2011 3 LEARNED CIT(A) AND DISMISSED THE REVENUES APPEALS. SINCE THE FACTS IN THE YEAR UNDER CONSIDERATION ARE ADMITTEDLY IDEN TICAL, WE, RESPECTFULLY FOLLOWING THE ABOVE DECISION OF ITAT I N ASSESSEES OWN CASE, DIRECT THE ASSESSING OFFICER TO ASSESS CONTRA CTUAL RECEIPTS OF THE ASSESSEE FROM M/S CAIRN ENERGY INDIA P.LTD. UNDER S ECTION 44BB OF THE ACT AND NOT AS FEES FOR TECHNICAL SERVICES. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. DECISION PRONOUNCED IN THE OPEN COURT ON 7 TH MARCH, 2014. SD/- SD/- ( (( (CHANDRA MOHAN GARG CHANDRA MOHAN GARG CHANDRA MOHAN GARG CHANDRA MOHAN GARG) )) ) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) (G.D.AGRAWAL) JUDICIAL JUDICIAL JUDICIAL JUDICIAL MEMBER MEMBER MEMBER MEMBER VICE PRESID VICE PRESID VICE PRESID VICE PRESIDENT ENT ENT ENT DATED : 07.03.2014 VK. COPY FORWARDED TO: - 1. APPELLANT : M/S GRANT GEOPHYSICAL INTLINC., M/S GRANT GEOPHYSICAL INTLINC., M/S GRANT GEOPHYSICAL INTLINC., M/S GRANT GEOPHYSICAL INTLINC., C/O MATTA SUDHIR & CO., C/O MATTA SUDHIR & CO., C/O MATTA SUDHIR & CO., C/O MATTA SUDHIR & CO., 15, ASTLEY HALL, DEHRADUN. 15, ASTLEY HALL, DEHRADUN. 15, ASTLEY HALL, DEHRADUN. 15, ASTLEY HALL, DEHRADUN. 2. RESPONDENT : ASSISTANT DIRECTOR OF INCOME TAX, ASSISTANT DIRECTOR OF INCOME TAX, ASSISTANT DIRECTOR OF INCOME TAX, ASSISTANT DIRECTOR OF INCOME TAX, INTERNATIONAL TAXATION, DEHRADUN. INTERNATIONAL TAXATION, DEHRADUN. INTERNATIONAL TAXATION, DEHRADUN. INTERNATIONAL TAXATION, DEHRADUN. 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR