Dipak Kumar Sen, J. - (1.) This is a consolidated reference covering the income-tax assessments of Universal Cargo Carriers Inc. for the assessment year 1976-77 (the accounting year ending on January 31, 1976), Hellenic Lines Ltd. for the assessment years 1976-77 and 1977-78 (the accounting years ending on 31st December of the calendar years 1975 and 1976) and American Export Line Inc. for the assessment year 1976-77, the accounting year ending on January 31, 1976.
(2.) The facts found and not in dispute are, inter alia, that the assessees are non-resident companies carrying on business in shipping. The ships of the assessees plied in Indian waters during the relevant assessment years which made the assessees exigible to Indian income-tax in the relevant assessment years.
(3.) The assessments in each of the cases were made under Section 44B which was brought into the Income-tax Act, 1961, by the Finance Act, 1975, and came into effect on and from April 1, 1976. The said section reads as follows : Section 44B.--"(1) Notwithstanding anything to the contrary contained in Sections 28 to 43A, in the case of an assessee, being a non-resident, engaged in the business of operation of ships, a sum equal to seven and a half per cent. of the aggregate of the amounts specified in Sub-section (2) shall be deemed to be the profits and gains of such business chargeable to tax under the head 'Profits and gains of business or profession'. (2) The amounts referred to in Sub-section (1) shall be the following, namely :-- (i) the amount paid or payable (whether in or out of India) to the assessee or to any person on his behalf on account of the carriage of passengers, livestock, mail or goods shipped at any port in India ; and (ii) the amount received or deemed to be received in India by or on behalf of the assessee on account of the carriage of passengers, livestock, mail or goods shipped at any port outside India.";