Per B.M. Kothari, Accountant Member - These two appeals by the Revenue are directed against a consolidated order passed by the Commissioner (Appeals) on 14-2-1990 for assessment years 1985-86 and 1986-87. The following common ground has been raised in these appeals :—

"That the learned Commissioner (Appeals) has erred in law as well as on facts in holding that income was assessable under section 44BB and not as fees from technical services under section 44D of the Act."

2. M/s. Oil & Natural Gas Commission (ONGC) as Agent of M/s. Foramer, France (non resident) submitted return of income for assessment year 1985-86 on 28-2-1986 declaring total income of Rs. 8,34,750 and for assessment year 1986-87 on 1-12-1986 declaring total income of Rs. 12,66,980. The Assessing Officer observed that the non-resident company M/s. Foramer, France (FF) had entered into a contract with ONGC for supply of supervisory staff and personnel having expertise in operation and management of drilling rigs "Sagar Jyoti" and "Sagar Pragati" in assessment year 1985-86 and for operation and management of drilling rig "Sagar Ratna" in assessment year 1986-87. The Assessing Officer relying upon the findings given in the assessment order for preceding year 1984-85 held that assessment of the said non-resident company should be completed as per provisions of section 44D, as the non-resident company had provided technical services to the ONGC. The payments received by the non-resident company from ONGC are in the nature of fees for technical services. The Assessing Officer accordingly computed the taxable income of the assessee on the amount paid by ONGC to the non-resident company after excluding the amount claimed to have been paid on account of reimbursement charges for the supply of material etc. Thus, the tax was levied on the amount of net receipts of the foreign company in accordance with section 44D of the Income-tax Act, 1961. The taxable income was thus determined in assessment year 1985-86 at Rs. 1,11,30,010 and at Rs. 1,68,93,120. Tax @ 40 per cent was charged on the said amount in view of provisions of section 44D read with section 115-A of the Income-tax Act, 1961.

3. The Commissioner (Appeals) following the order of the ITAT, Delhi in the case of M/s. Scan Drilling Company, ITA No. 4834 (Delhi) dated 7-9-1987 for assessment year 1985-86 held that the income of the assessee is assessable under section 44BB of Income-tax Act, 1961 and not as fees from technical services under section 44D of Income-tax Act. The Commissioner (Appeals) also relied upon the appellate order passed in assessee’s own case by the Commissioner (Appeals) for assessment year 1984-85.

4. The Revenue has filed the present appeals challenging the aforesaid order passed by the Commissioner (Appeals) contending that the Commissioner (Appeals) has erred in holding that the income was assessable under section 44B and not as fees from technical services under section 44D of the Act.

4.1 Shri S.N. Bhargava, the learned Commissioner of Income-tax who represented the appellant, was fair enough to state that prima facie it appears that the point in issue is covered by an earlier order passed by the Tribunal in assessee’s own case for assessment year 1984-85 and also by the decision of the Tribunal in the case of ONGC as Agent of M/s. Scan Drilling Company. He, however, pointed out that the Tribunal while rendering above referred earlier decisions failed to take into consideration certain vital facts, which justifies a fresh look on the point in issue.

4.2 Shri Bhargava, the learned Commissioner (DR) submitted that there is a subtle and significant difference between two separate types of agreements executed between ONGC and M/s. Foramer, France. He drew our attention towards Agreement dated 4-2-1988 under which M/s. F.F. had agreed to provide the services of expatriate supervisory staff and personnel with expertise in operation and management of Jack-Up rig named "Sagar Pragati". He submitt