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2016 (8) TMI 1311 - AT - Income TaxAdditions on account of service tax - treated to the income of the assessee company - Held that:- We find ourselves to be in agreement with the claim of the Ld. A.R that as the amount reduced by the customers on account of service tax liability from the amount of fees/royalty, which otherwise but for the said reduction would had been payable to the assessee company, had been accepted as such in full and final discharge of the liability of the customers as regards the fees/royalty payable to the assessee company, and the assessee company had not retained with itself any right as regards recovery of any such amounts deducted by the customers qua the liability towards service tax as was so cast upon them, therefore the aforesaid amount of ₹ 1,71,13,337/-(supra) cannot be treated to be the income of the assessee company, but as we are persuaded to arrive at such a finding in light of the claim raised by the Ld. A.R for the assessee company on the basis of the aforesaid letter dated 25/07/2016, we therefore restore the issue to the file of the A.O for verifying the aforesaid claim of the assessee company, and on finding the same in order, delete the addition made in the hands of the assessee company Interest levied u/s 234B - Held that:- The levy of interest u/s 234B of the ‘Act’ would be automatic, mandatory and consequential to the framing of regular assessment in the hands of the assessee company, but the process of fastening the levy of interest u/s 234B must be preceded by surfacing of the fact that the assessee company is found to be in default as regards the statutory obligation as stood cast upon it with respect to payment of advance tax. Thus now when the issue pertaining to substantive addition had been restored by us to the file of the A.O for making necessary verifications and giving effect to the same as per our directions, we therefore also restore the present issue as regards the liability of the assessee company towards interest u/s 234B of the ‘Act’ to the file of the A.O, with the direction that the same be adjudicated in light of our aforesaid observations. Thus the ‘Ground of appeal’ No. 2 is allowed for statistical purpose
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