Entire mobilization/demobilization revenues received by the applicant with respect to seismic data acquisition and/or processing would be taxable in India at an effective rate of 4.223% – AAR

Western Geco International Limited Vs. DDIT (International Taxation), Dehradun (Advance Ruling Authority)- Even if part of the income falls under ‘Royalties’ or ‘Fees for technical Services’, there is no scope to assess such receipts under these heads, once it is held that the income is from its oil exploration and production activities as envisaged under section 44BB. We are of the view that if the applicant desires to know the answers to the two issues, then it has to first exercise the option to get its income computed under section 44BB(3). In view thereof, we answer the Question No. 2 by saying that the entire mobilisation/ demobilisation revenues received by the applicant with respect to seismic data acquisition and/or processing would be taxable in India at an effective rate of 4.223%.

BEFORE THE AUTHORITY FOR ADVANCE RULINGS (INCOME TAX) NEW DELHI

25^th Day of July, 2011

A.A.R. No. 938 of 2010

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