Garg, A.M. - This is an appeal by the revenue against the order of the CIT(A) for assessment year 1986-87. The only ground raised in this appeal reads as under :

"On the facts and in the circumstances of the case and in law, the learned CIT(A) erred in holding that the D.C. was not justified in holding that assessee’s income is taxable in India. Further also erred in cancelling the assessment made under section 143(3) of the I.T. Act, 1961."

2. The assessee, a non-resident company incorporated in the United Kingdom, received Rs. 1,58,48,719 from Mazagaon Dock Ltd. in pursuance of an agreement dated 2-4-1985 and Rs. 98,39,380 from Oil & Natural Gas Commission vide agreement dated 29-8-1985. Under both the agreements, the assessee undertook the work of inspection and repairing of submarine pipeline networks, used in connection with oil and gas exploration, extraction and production with the help of a vessel, Special Remotely Operated Vehicles (hereinafter referred to as ‘ROV’), which performed the submarine work. Relying upon article 7(1), read with article 5(2)(h) and (i) of the Double Taxation agreement, the Assessing Officer held that the profit arising from these receipts is t