Orient Overseas Container Line Limited vs. Deputy Commissioner of Income Tax (International Taxation)

Parties Involved

Facts Summary

The assessee, Orient Overseas Container Line Limited, is a company incorporated under the laws of Hong Kong, engaged in the business of operating ships in international traffic. Its revenue comprises freight income and ancillary charges such as terminal handling charges, demurrage charges, etc. The assessee filed its return of income for the year under consideration, declaring a total income of Rs.1,32,79,99,310/-. The return was selected for scrutiny, and notices under section 143(2) and section 142(1) of the Act were issued. During the assessment proceedings, it was noticed that the assessee had collected GST in respect of ancillary charges but had not included it while computing the presumptive income under section 44B of the Act. The Revenue asked the assessee to show cause as to why the GST should not be treated as part of the turnover for the purpose of section 44B of the Act. The assessee submitted that the amount of GST collected by it cannot be added to the presumptive income computed under section 44B of the Act, as section 44B(2) of the Act covers amounts in connection with the carriage of goods, passengers, etc. The assessee placed reliance upon the decision of the Tribunal rendered in its own case for the preceding years, wherein the same addition was deleted.…

Legal Issues

• 1. Including the Goods and Services Tax (GST) receipts for computation of deemed income under section 44B of the Act.
• 2. Applicability of the provisions contained in section 115-JB of the Act.
• 3. Short grant of credit of TDS and advance tax and non-grant of interest under section 244A of the Act.
• 4. Erroneous levy of interest and initiation of penalty proceedings under section 270A of the Act.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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