Director Income Tax (International Taxation), Delhi-Ii, New Delhi v. J. Ray Mcdermott Middle East Inc

IN THE HIGH COURT OF UTTARAKHAND AT NAINITALINCOME TAX APPEAL NO. 27 OF 2011 Director Income Tax (International Taxation), Delhi-II, New Delhi. ……….Appellant. ……Respondent. Versus J. Ray McDermott Middle East Inc. Mr. Hari Mohan Bhatia, Advocate for the appellant. Mr. P.R. Mullick, Advocate for the respondent. Coram: Hon'ble Barin Ghosh, C.J.Hon'ble V.K. Bist, J. Barin Ghosh, C.J. (Oral) Agreement No. 70711 dated 15[th] August, 1995 entered by the assessee with Enron Oil and Gas India Ltd. required the assessee to carry out certain work outside India and to be remunerated in respect of such work outside India. It was so remunerated in one assessment year. The payment, so received, was included in the taxable liability of the assessee during that assessment year. The said assessment travelled to this Court in Income Tax Appeal No. 12 of 2007. This Court declared that the income derived from the said agreement entered outside India for providing administrative and support service outside India and, in respect whereof, remuneration has been received outside India will not come within Section 5(2), read with Section 9(1)(i) of the Indian Income Tax Act and is, accordingly, not taxable in India. A similar claim has been made by the Department against the assessee during another assessment year. That claim is the subject matter of the present Appeal. 2. For the reasons already indicated above, we delete that part of the inclusion, which was added in respect of the Agreement No. 70711 dated 15[th] August, 1995 for providing administrative and support service outside India and, in respect whereof, remuneration has been received outside India. It is made clear that claim of interest on that addition automatically will go. 3. The Appeal is, accordingly, disposed of. (V.K. Bist, J.) (Barin Ghosh, C.J.) 31.03.2014