COMMISSIONER OF INCOME TAX AND THE DEPUTY COMMISSIONER OF INCOME TAX, SPECIAL RANGE Vs. HALLIBURTON OFFSHORE SERVICES INC.

JUDGEMENT

(1.) THIS appeal is directed against the order dated 15.9.2006 passed by the Income Tax Appellate Tribunal, Delhi Bench 4A4, New Delhi (for short, the ITAT) passed in ITANo. 794/Del/1997 pertaining to Assessment Year 1991 -92, whereby the ITAT has upheld the judgment of the CIT (Appeals) and dismissed the appeal of the Revenue. The CIT (Appeals) vide his order dated 16.7.1996 allowed the appeal of the assessee and had held that addition of Rs. 6,16,989/ - received by the assessee on account of reimbursement of freight and transportation charges actually incurred in respect of equipment. Both CIT (Appeals) as well as the ITAT has held that these charges were freight and transportation charges incurred in respect of transportation of equipment by the assessee to ONGC and did not constitute an income and cannot be added as total income of assessee and on account of liquidated damages from the contract bills raised by the assessee could not be said to have accrued as income to the assessee so as to fall within the ambit of charging provisions of Section 5 of the Income Tax Act.

(2.) WE have heard Sri Arvind Vashistha, learned Standing Counsel for the Revenue and perused the record. Affidavit of service has been filed on behalf of the appellant, but despite service, none appeared on behalf of the respondent to contest this appeal.

(3.) TO answer this question we directly go to Section 44BB which reads as under: