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2016 (9) TMI 1616 - AT - Income TaxRevision u/s 263 by CIT - service tax amount has not been paid on or before filing the IT return as mandated under the provision of Sec. 43B of the Act and secondly, the AO at the time of assessment has allowed the depreciation @ 100% on the hoarding structure - HELD THAT:- As per the Service Tax Law, Service Tax is payable as and when the payment /fees for underlying service provided are realized. As the appellant firm has not received the sum till the end of the financial year i.e. 2007-08, the question of paying the same did not arise at all. As already stated the fact of non-realization of fees is disputed by the AO in his order. If for any reason the payment for services rendered is not realized (bad debts), there was no liability as to payment of service tax - service tax law stands on a different footing as compared to other laws like Central Excise or VAT. As per the provisions of section 145A taxes and duties should form part of the Gross Receipts but it as application is restricted to purchase and sale of goods only, and does not extend to service contracts. Thus, the liability of the service tax dos not also arise as per section 145A . As in respect of valuation of purchase and sale of goods and inventory and not to service contracts. Therefore the action of the Assessing Officer in invoking provisions of section 145A of the Act and adding Service Tax to Gross Receipts is incorrect in as much as against the very basic principles of section 145A. Apart from the above, we find that the payment for services rendered was not received in the financial year under consideration. Similarly for the issue raised for the depreciation claimed @ 100% on the hoarding structure, we find that the hoarding structures are temporary in nature and they cannot be equated with the building for the reason that the temporary structures are raised in temporary location which are taken on lease – once the structures are removed the value becomes almost nil and cannot be used again. - Decided in favour of assessee.
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