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Income Tax Appellate Tribunal, DELHI BENCH “ F ”: NEW DELHI
Before: SHRI H S SIDHU & SHRI PRASHANT MAHARISHI
O R D E R PER PRASHANT MAHARISHI, A. M. 1. This is appeal filed by the assessee against the order of the Commissioner of income tax (appeals) – II, Dehradun dated 19th 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 officer in holding that the amounts aggregating to Rs. 225347824/- received by the appellant from its customers as reimbursement of actual expenses incurred by the appellant on their behalf, is to be included in the gross receipts u/s 44BB of the Income Tax Act 1961.
2. The brief facts of the case are that appellant is a company incorporated under the laws of Australia having its registered office at Perth Australia. The Indian project offers is at Mumbai. The assessee 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 Act. For assessment year 2010 – 11 it filed its return of income on forced October 2010 declaring total income of Rs. 323613847/-. In the return of income, assessee has claimed that Rs. 225347824/- received on account of reimbursement of supply of material and fuel recharge 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. Appellant preferred on appeal before the Commissioner of income tax appeals varied by order dated 19th of December 2013 dismissed the claim of the claim of the appellant. Therefore, assessee is in appeal before us.
3. Learned AR of the appellant submitted that the issue is squarely covered by the decision of coordinate bench in assessee’s own case for assessment year 2009 – 10. He placed on record the copy of the decision 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 the decision is of Hon’ble 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 assessee is to be considered as a part of the receipt for the purposes of computation of income useless as 44BB of the income tax act.
Learned DR also agreed with the above proposition and submitted that this issue is squarely covered against the assessee in its own case by decision of the coordinate bench for assessment year 2009 – 2010.
We have carefully considered the rival contentions and we have also produced the decision of coordinate bench in case of the assessee itself for assessment year 2009- 2010 wherein this issue has already been decided against the assessing as under:-
“4. The assessee’s 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 order of Coordinate Bench of the Tribunal still holds field because the same has not been set aside or modified by the Hon’ble higher appellate forum till date. In view of above, we observe that the present case is also squarely covered by the above judgment of ITAT Delhi ‘F’Bench dated 27.4.2012 in for AY 2008-09 (supra) and the sole ground of the assessee deserves to be decided against the assessee. The assessee’s representative has placed his reliance on the judgment of Hon’ble Jurisdictional High Court of Uttarakhand in the case of Haliburton Offshore Service Inc (2008) 300 ITR 265 (Uttarakhand) 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% without any deduction like freight and transportation charges. The ld. DR contended that the Hon’ble High Court of Uttarakhand has considered the scheme of presumptive determination u/s 44BB of the Act and has held that this section is a complete code in itself and provides for taxation of all receipts whether arising in India or outside. Thus, for the purpose of presumptive determination of assessee’s profits, quantum of amount received by it from its customers against its reimbursement 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 covered by the aforesaid decision while no other contrary decision was brought to our notice nor ld. AR placed any contrary material before us controverting the aforesaid findings of the Assessing Officer, we have no hesitation in upholding the findings of the Assessing Officer.”