High Court of Uttarakhand · Judgments and reasoned final orders
Commissioner of Income Tax (International Taxation) v. Baker Hughes Asia Pacific Limited
Income Tax Appeal No. 30 of 2015 ·
Non-resident oilfield service provider taxation under section 44BB(2): reimbursement of service tax by ONGC does not form part of aggregate gross receipts under section 44BB(2)(a)/(b) following Full Bench decision and Mitchell Drilling International; section 234B interest question remitted to AO.
1. FACTS OF THE CASE
The Commissioner of Income Tax (International Taxation) filed ITA No. 30 of 2015 against Baker Hughes Asia Pacific Limited raising substantial questions of law regarding: (i) assessability of oilfield service receipts under section 44BB; (ii) whether service tax reimbursed by ONGC forms part of aggregate amounts under section 44BB(2)(a)/(b); and (iii) liability to interest under section 234B.
2. DISCUSSION BY THE COURT
Following the Coordinate Bench decision in ITA No. 34 of 2015 and the Full Bench decision of the Uttarakhand High Court (which followed DIT v. Mitchell Drilling International Pvt. Ltd. (2016) 380 ITR 130 (Del) and DIT v. Schlumberger Asia Services Ltd. (2009) 317 ITR 156 (Uttarakhand)), the Division Bench held that: (1) the questions relating to assessability under section 44BB stand answered against the Revenue; (2) service tax paid by the service provider and reimbursed by ONGC does not form part of the aggregate amount referred to in section 44BB(2)(a) and (b); and (3) the question of liability under section 234B is remitted to the AO to examine on the basis that the receipts fall under section 44BB.
3. JUDICIAL DECISION
Disposed of ITA No. 30 of 2015 answering the section 44BB and service-tax exclusion questions in favour of the assessee and remitting the section 234B issue to the Assessing Officer.
4. OUTCOME
Assessee (on section 44BB assessability & service-tax exclusion) / Remand on section 234B - Questions on section 44BB and service-tax reimbursement answered in favour of the assessee; section 234B interest question remitted to the Assessing Officer.
5. AKHB REVIEW POINT
AKHB analysis: under the Uttarakhand High Court Full Bench ruling and Mitchell Drilling International, statutory indirect-tax reimbursements (such as service tax or GST) collected/reimbursed without markup do not constitute 'amount paid or payable on account of the provision of services' under section 44BB(2).
Source and verification
4-page official High Court of Uttarakhand judgment PDF (20250210_UKHC010009682015.pdf).
Original PDF: 4 pages · SHA-256: 30f064eb57c5ae6b53bf5333a4082fd0288ed3340e36139aee2e532fb213c881
Supplied source-reviewed note retained; original bytes and identity validation checked in this release. Substantive re-review is not claimed for this record.
Applies sections 44BB and 234B of the Income-tax Act, 1961. Income-tax Act, 2025 equivalence is not verified.
Full primary judgment PDF read page-by-page and verified against the AKHB Google Drive repository. Comprehensive subsequent judicial treatment has not been independently verified.
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