COMMISSIONER OF INCOME-TAX AND ASSTT. COMMISSIONER OF INCOME-TAX, SPECIAL RANGE Vs. R AND B FALCON DRILLING CO.

JUDGEMENT

(1.) THIS appeal, preferred under Section 260 -A of the Income Tax Act, 1961 (hereinafter referred as the Act) is directed against the order dated 22.12.2006, passed by the Income Tax Appellate Tribunal, Delhi Bench 'H', New Delhi (hereinafter referred as ITAT), in Income Tax Appeal No. 324 / D / 2005, for the assessment year 2001 - 02.

(2.) THE question of law involved in this appeal, is as under: Whether, the Income Tax Appellate Tribunal has erred in law in holding that mobilization / demobilization charges in respect of voyage conducted in Indian territorial waters only, are to be included in the gross revenue and the remaining amount of such charges are not part of the gross revenue, for the purposes of computation of income under Section 44BB of the Income Tax Act, 1961?

(3.) BRIEF facts of the case giving rise to this appeal are that assessee, a non -resident company, engaged in business of extraction of mineral oils, submitted its return of income declaring income at Rs. 4,74,73,259/ - for the Assessment Year 2001 -02. The case was processed under Section 143(1) of the Income Tax Act by the Assessing Officer, who issued notices under Section 143(2) of the Act to the assessee as to why not the reimbursement charges received by the assessee from Enron Oil and Gas India Limited be included in the gross receipts, received by the assessee? After hearing the parties, the Assessing Officer included said receipts amounting to Rs. 1,65,64,444/ -. Aggrieved by said order, the assessee preferred appeal before the Commissioner of Income Tax (Appeals) [for brevity 3 CIT(A)], but the same was also dismissed vide order dated 14.09.2004, passed by CIT(A) -1, Dehradun. Thereafter, the assessee filed Second Appeal No. 324 / D / 2005 before the ITAT, Delhi. The ITAT, after hearing the parties, allowed the appeal holding that the mobilization / demobilization charges are not required to be included in the receipts for the purposes of calculating the presumptive income under Section 44BB of the Act. Hence, this appeal by the Revenue.