a) ONGC entered into a contract with Abu Dhabi Ship Building PJSC and Rodman Polyship, Vigo, Spain for construction of Immediate Support Vessels (ISV).
b) ONGC filed application before the Assessing Officer (AO) under section 195(2) requesting for approval for non–deduction of tax at source on payment for the construction of the ISVs.
c) AO rejected the application as he was of the view said payments were taxable in India and, thus, liable to tax deduction at source under section 195.
d) Abu Dhabi Ship Building (payee) filed an appeal before the CIT (Appeals) challenging the order under section 195(2). CIT (A) reversed the order of AO.
e) Aggrieved by the order of CIT (A), revenue filed the instant appeal before the Tribunal. The issue before the Tribunal was as under:
Whether the appeal filed by Abu Dhabi Ship Building (Payee) before the learned Commissioner (Appeals) challenging order of AO passed under section 195(2) would be maintainable under section 246A or not ?
Tribunal held in favour of revenue as under:
1) Section 246A lays down the provision for filing of appeal before the first appellate authority. There is no mention of an order passed under section 195(2) as an appealable order.
2) However, there is a specific provision engrafted into the Act by way of section 248 under which an appeal against an order under section 195 can be filed that too, by the payer /deductor of tax.
3) When there is a specific provision for filing appeal against an order u/s 195(2) by a specified person, the appeal before the first appellate authority can be maintainable only if it is filed in terms of the said provision and in no other manner.
4) Therefore, Order passed by Assessing Oicer under section 195(2) cannot be challenged before CIT(A) under section 246A as there is a specific provision under section 248 for filing appeal against such order. -  70 taxmann.com 224 (Mumbai - Trib.)