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Dy Commissioner of Income Tax – 10 (2) , Mumbai Versus M/s Gopinath Engineering Co Pvt Ltd, and Vica-Versa

2015 (12) TMI 348 - ITAT MUMBAI

Disallowance on account of non-payment of service tax liability u/s 43B - CIT(A) deleted the addition - Held that:- CIT(A) has given a categorical finding of fact that the assessee had not claimed the amount of Service Tax Liability in the profit and loss account and hence there was no question of making disallowance and Secondly, the assessee had collected the Service Tax and paid later, on the dates as incorporated above. Thus, no disallowance u/s 43B can be sustained under these facts and cir .....

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REME COURT ]. Thus, the order of the CIT(A) on this score also is upheld. - Decided in favour of assessee - ITA No. : 7606/Mum/2013, Cross Objection No. 113/Mum/2015 - Dated:- 4-9-2015 - SHRI AMIT SHUKLA, JUDICIAL MEMBER AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER For The Appellant Cross Objector : Shri Surendra Damle For The Respondent : Shri B.D Naik PER AMIT SHUKLA, JM: The aforesaid appeal has been filed by the revenue and Cross Objection by the assessee against the impugned order dated 15.10.2 .....

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he fact that the assessee made the payment of the Service Tax liability amounting to ₹ 1,02,21,606/- after filing of Return of Income for the current year. 1.2 On the facts and in the circumstances of the case as well as in law, the Ld. CIT(A) erred in not appreciating the fact that the balance Service Tax payment made on amount of late payment of Employees Contribution of PF amounting to ₹ 29,69,876/-. 2. On the facts and in the circumstances of the case as well as in law, the Ld. C .....

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essment proceedings, the Assessing Officer on the perusal of the Balance Sheet noticed that there is a mention in Schedule H , regarding unpaid service tax liability and Employees contribution to provident fund for sums amounting to ₹ 1,29,79,838/- and ₹ 29,69,876/- respectively. The Assessing Officer held that such a payment should be disallowed u/s 43B as there has been delayed payment on account of both, Employee s contribution to PF and delay in payment of Service Tax. 3. The Ld. .....

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ssessee had to pay the service tax after collecting the service tax from the payers as per the Service Tax Rules, which the assessee had done as per the details mentioned at page 4 of the appellate order. The relevant observation and finding of the CIT(A) in this regard are as under :- I have considered the facts and circumstances of the case. During the year under consideration AO had added ₹ 1,29,79,838/- for non-payment of service tax liability as on 31.03.2010. On verification of the r .....

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t the amount to the profit and loss account as on expenditure nor did the assessee claim any deduction in respect of the amount and considering that the assessee is following the mercantile system of accounting, the question of disallowing the deduction not claimed would not arise . In the case of ACIT vs Real Image Media Technologies (P) Ltd (2008) 116 TTJ 964 (Chennai) wherein it is held as under: (2009) 21 ITD 461 (Chennai) (TM) Section 43B can only be invoked when the assessee claims deducti .....

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stant cases appellant had not claimed any deduction, hence, AO cannot disallow the amount. Moreover till July 2011, the appellant had to pay service tax only after collecting the service tax from the payers as per the service tax rules. The appellant had collected the service tax later and paid the same as under: Date BEFORE FILING OF ITR Amount 06.05.2010 1,043,679.00 06.05.2010 62,972.00 06.05.2010 677,202.00 30.06.2010 974,379.00 TOTAL 2,758,232.00 Date AFTER FILING OF ITR Amount 01.11.2010 9 .....

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