TMI Blog2016 (3) TMI 360X X X X Extracts X X X X X X X X Extracts X X X X ..... l Services Pvt. Ltd. (2015 (2) TMI 587 - BOMBAY HIGH COURT ) by considering the Hon’ble Delhi High Court decision in the case of CIT Vs. Noble Hewitt (I) (P) Ltd. (supra) wherein both the issues i.e. Section 43B and issue of mercantile system of accounting had also been considered and held that in case of assessee, Section 43B no disallowance can be made. The Hon'ble Supreme Court has also dismissed the SLP filed by the department in the case of CIT Vs. M/s Calibre Personnel Services Pvt. Ltd. (supra). By respectfully following the decision of both the Hon’ble Courts, we delete the addition confirmed by the ld CIT(A). - Decided in favour of assessee - ITA No. 777/JP/2013 - - - Dated:- 29-1-2016 - SHRI T.R.MEENA, AM AND SHRI LALIET KUMAR, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ressed, therefore, we dismiss the same as not pressed. 3. Grounds No. 1 and 2 of the appeal are against sustaining the disallowance of ₹ 49,65,614/- by contravention of provisions of Section 43B of the Income Tax Act, 1961 (in short the Act). The assessee is a C F of various companies, in transport business and other sources. The assessee filed return on 08/2/2010 declaring total income of ₹ 2,04,99,030/-. Thereafter the return was revised on 20/03/2010 showing income of ₹ 2,05,14,030/-. The case was scrutinized U/s 143(3) of the Income Tax Act, 1961 (in short the Act). The ld Assessing Officer observed that as per audit report in form No. 3CD, Annexure-D, it has been reported by the auditor that service tax due had not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is liable to be disallowed. Accordingly, he made addition of ₹ 60,08,570/- in the income of the assessee. 4. Being aggrieved by the order of the Assessing Officer, the assessee carried the matter before the ld CIT(A), who had confirmed the addition, which was challenged by the assessee for ₹ 49,65,614/-, addition made by the Assessing Officer at ₹ 60,08,570/-. The operative portion of the order of the ld CIT(A) is reproduced as under:- 2.3 I have considered the facts of the case; assessment order and appellant s written submission. Assessing officer disallowed service tax not paid till the due date of filing return. However appellant submitted that he has received service tax only to the extent of ₹ 49,65,61 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the additions and no facts are on record, therefore this claim cannot be entertained. 5. Now the assessee is in appeal before us. The ld AR of the assessee has submitted that the service tax collected by the assessee was not liable to deposit any service tax, which had not been received by him during the year under consideration. The service tax has also not been debited in the P L account during the year under consideration. The assessee had followed mercantile system of accounting. He further relied on the decision of Hon ble Delhi High Court in the case of CIT Vs. Noble Hewitt (I) (P) Ltd. [2008] 305 ITR 324 (Del) wherein it has been held that where the assessee was following mercantile system of accounting but had neither debited ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the order of the ld CIT(A) and argued that the assessee s case is covered U/s 43B of the Act. 7. We have heard the rival contentions of both the parties and perused the material available on the record. The assessee has not debited service tax in P L account, which has been shown in service tax account separately. The Hon ble Delhi High Court in the case of CIT Vs. Noble Hewitt (I) (P) Ltd. (supra) has held that the assessee followed mercantile system of accounting and collected service tax. The amount of service tax has not been debited in the P L account as also not claimed as deduction, therefore, amount could not be disallowed. Further the Hon ble Bombay High Court in the case of CIT Vs. M/s Calibre Personnel Services Pvt. Ltd. (su ..... X X X X Extracts X X X X X X X X Extracts X X X X
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