DCIT, CIRCLE- 2(2)(2), INTL. TAXATION, NEW DELHI vs. NATIONAL PETROLEUM CONSTRUCTION COMPANY, NOIDA

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ITA 5563/DEL/2017Status: DisposedITAT Delhi01 July 2021AY 2011-1218 pages
AI SummaryDismissed

What did the Tribunal hold?

The CIT(A) found the issue covered in favor of the assessee by a Delhi High Court decision for earlier assessment years. The Tribunal, respectfully following the High Court's binding decision, declined to interfere.

What were the facts?

The assessee, a UAE-based company, entered into contracts with ONGC for fabrication and installation of platforms and pipelines. The Assessing Officer made an adjustment of Rs. 32.52 crores in the assessment order. The assessee appealed to the CIT(A).

What were the issues?

Whether the income tax assessment, particularly regarding installation and commissioning, was correctly determined and if it violated the India-UAE Double Taxation Avoidance Agreement.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 144C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH ‘D’, NEW DELHI

Before: SH. N. K. BILLAIYA & SH. SUDHANSHU SRIVASTAVA

For Respondent: Dr. Prabha Kant, CIT
Hearing: 01/07/2021Pronounced: 01/07/2021

This appeal filed by the revenue is preferred against the order of the CIT(A)-43, New Delhi dated 06.06.2017 for A.Y. 2011-12.

2.

The grievance of the revenue read as under :-

3.

Briefly stated the facts of the case are that the assessee is a company incorporated and existing under the laws of UAE and also a tax resident there. The principal activities of assessee include fabrication and installation of onshore and offshore platforms and submarine pipelines and pipelines coating. The assessee has also entered into contracts with ONGC for the aforesaid purposes. As per the terms of the contract, NPCC has carried out sequential activities such as design and engineering, material procurement, fabrication and installation.

4.

While framing the assessment order u/s. 143 (3) / 144 C of the Act the AO observed as under :-

5.

It can be seen from the above that the AO has followed the findings given in A.Y.2007-08 and 2008-09 and completed the assessment by making adjustment of Rs. 32.52 crores.

6.

The assessee assailed the assessment before the CIT(A) and the CIT(A) found that the issue is covered in favour of the assessee by the order of the Hon’ble High court of Delhi for A.Y.2007-08 and 2008-09. The following substantial question of law were framed and answered by the Hon’ble High Court of Delhi :-

1) Whether the Income Tax Appellate Tribunal has not attributed and determined the taxable income under installation and commissioning; whether the said issue/ question has remained undecided and the effect thereof.

2) Whether the order of the I ncome Tax Appellate Tribunal violates and is contrary to Article 7 (6) of the Double Taxation Avoidance Agreement between India and UAE.

7.

And the Hon’ble High Court adjudicated the quarrel as under :-

Reasoning and Conclusion

8.

As no distinguishing decision has been brought to our notice, respectfully following the binding decision of the Hon’ble High Court of Delhi (supra) we decline to interfere.

9.

In the result, the appeal filed by the revenue is dismissed.

10.

Decision announced in the open court in the presence of both the representatives on 01.07.2021.

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