TMI Blog2016 (8) TMI 1096X X X X Extracts X X X X X X X X Extracts X X X X ..... n before us that the respondent assessee had not claimed any deduction on account of the service tax payable in order to determine its taxable income. In the above view, there can be no occasion to invoke Section 43B of the Act. The issue stands concluded against the Revenue by the decisions of this Court in Commissioner of Income Tax Vs. Ovira Logistics P. Ltd. [2015 (4) TMI 684 - BOMBAY HIGH COURT ] and Commissioner of Income Tax Vs. Calibre Personnel Services Pvt. Ltd. (2015 (2) TMI 587 - BOMBAY HIGH COURT ) - INCOME TAX APPEAL NO. 247 OF 2014 WITH INCOME TAX APPEAL NO. 255 OF 2014 - - - Dated:- 16-8-2016 - M.S. SANKLECHA AND A.K. MENON, J.J. For The Appellant : Mr. Suresh Kumar a/w Ms. Samiksha Kanani For The Respondent : M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... include the service tax billed by it for rendering services to the service receivers as trading receipts on invocation of Section 145A(ii) of the Act. Besides, the Assessing Officer also sought to invoke Section 43B of the Act on the ground that the billed amount of service tax had not been paid over to the Government till the due date of filing the return of income. The Assessing Officer also sought to recast the respondent's profit and loss account so as to reflect the receivable service tax as a part of the consideration for the services rendered. The respondent assessee contended that Section 145A(a)(ii) of the Act would have no application to the present facts as service tax is not mentioned therein. Further, it was submitted that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the aforesaid amounts while determining its income. Accordingly, the appeal of the respondent assessee was allowed. 6. Regarding question (i) : (a) For the better appreciation of the controversy to be examined, it is necessary to reproduce Section 145A of the Act, which at the relevant time read as under : 145A Notwithstanding anything to the contrary contained in Section 145 ( a) the valuation of purchase and sale of goods and inventory for the purposes of determining the income chargeable under the head Profits and gains of business or profession shall be (i) in accordance with the method of accounting regularly employed by the assessee; and (ii) further adjusted to include the amount of any tax, duty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or does it have anything to do with bringing the goods to a particular location. (e) The Explanation to Section 145A(a) of the Act does not expand its scope. An Explanation normally does not widen the scope of the main section. It merely helps clarifying an ambiguity. (See Zakiyr Begam v/s. Shanaz Ali Ors., 2010 (9) SCC 280). The main part of the Section specifically restrict its ambit only to valuation of purchase and sale of goods and inventory. Rendering of service is not goods or inventory. Goods would mean movables and inventory would mean stock of goods. Therefore, the Explanation would only apply for valuation of sales and purchase of goods and stock of goods as provided in the main part. The Explanation in this case clarifies/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ervices. As observed by the Apex Court in State of Bihar v/s. S. K. Roy AIR 1966 (SC) 1995: It is well recognized principle in dealing with construction that a subsequent legislation may be looked at in order to see what is the proper interpretation to be put upon an earlier Act where the earlier Act is obscure or capable of more then one interpretation. We must make it clear that we do not find any ambiguity in Section 145A of the Act as arising for our consideration. However, even if one were to assume the main part of Section 145A of the Act, is capable of more then one interpretation, the interpretation sought to be canvassed by the Revenue, is not sustainable. Therefore, Section 145A of the Act would have no application ..... X X X X Extracts X X X X X X X X Extracts X X X X
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