Page Contents
IHI Corporation v. ADIT [Mumbai ITAT] ITA No. 7267 of 2012
Date of Decision: April 17, 2015
The assessee, a Japanese company, was a manufacturer of heavy machinery, providing technology oriented products and services to industrial, private and public sectors. It had been awarded Engineering, Procurement, Construction and Commissioning contracts by Petronet LNG Ltd. in India.
The assessee offered the income received from onshore activities to tax in India with the claim of applicability of India Japan tax treaty but had not offered income from offshore supply and offshore services to tax in India on the ground that income from offshore supply was not received in India, as its actual place of business was outside India and, hence, it had neither accrued or arisen in India.
The Appellate Tribunal held that the income from identical services rendered by the assessee in respect of the contract under consideration cannot be characterized differently.
The income from offshore services, though chargeable under section 9(1)(vii) but exempt under the DTAA, cannot be charged to tax in the light of section 90(2). It was further held that the provisions of section 90(2) is very clear that where the Central Government has entered into an agreement with the Government of any country outside India or specified territory outside India, as the case may be, under sub-section (1) for granting relief of tax, or as the case may be, avoidance of double taxation, then, in relation to the assessee to whom such agreement applies, the provisions of this Act shall apply to the extent they are more beneficial to that assessee.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Hope the information will assist you in your Professional endeavors. For query or help, contact: singh@carajput.com or call at 9555555480
Read our articles:
What is UPI MDR (Merchant Discount Rate), and why is it being introduced? What is MDR? Merchant Discount Rate (MDR)… Read More
Building a Robust Audit Manual for CA Firms: From Design to Implementation In today's increasingly regulated audit environment, maintaining a… Read More
Apply Early, Stay Compliant: AFA Renewal for December 2026 and Its Impact on NCLT Empanelment The renewal of the Authorisation… Read More
Decoding Form 10B & Form 10BB for AY 2026-27: for Charitable Trust Introduction The audit reporting landscape for charitable trusts… Read More
Cabinet Approves Enhancement of EPFO Wage Ceiling from INR 15,000 to INR 25,000 per Month The Union Cabinet, chaired by… Read More
Income Tax Practitioner (ITP) Registration Process as per New Income Tax Act, 2025 We are going to discuss the Concept… Read More
