TMI Blog2018 (8) TMI 1645X X X X Extracts X X X X X X X X Extracts X X X X ..... - - Dated:- 28-8-2018 - SHRI SAKTIJIT DEY, JUDICIAL MEMBER AND SHRI RAMIT KOCHAR, ACCOUNTANT MEMBER For The Assessee : None For The Revenue : Ms. Sunita Billa, DR ORDER PER RAMIT KOCHAR, Accountant Member This appeal, filed by the assessee, being ITA No. 1538/Mum/2017, is directed against assessment order dated 31.01.2017 passed by the learned Assessing Officer (hereinafter called the AO ) u/s 143(3) r.w.s. 144C(13) of the Income-tax Act, 1961 (hereinafter called the Act ) in pursuance of directions dated 29.11.2016 issued by learned Dispute Resolution Panel-1(WZ), Mumbai (hereinafter called the DRP ), for assessment year 2013-14. 2. The grounds of appeal raised by the assessee in the memo of appeal filed with the Income-Tax Appellate Tribunal, Mumbai (hereinafter called the tribunal ) read as under:- The Appellant appeals against the impugned order dated 31st January, 2017 passed by the Deputy Commissioner of Income Tax (IT)-2(2)(2) Mumbai (received by the Appellant on 2nd February, 2017) under section 143(3) r.w.s. 144C(13) of the Income tax Act, 1961 (the Act) on the following amongst other grounds each of which is in the alternat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of the tribunal and an appeal has been filed with Hon ble Bombay High Court which is pending for disposal, the additions were confirmed by learned DRP vide directions dated 29.11.2016 issued u/s 144C(5) of the 1961 Act which later culminated into an assessment order dated 31.01.2017 passed by the AO under 143(3) r.w.s 144C(13) of the 1961 Act. 5. Aggrieved, the assessee has come in an appeal before the tribunal and none appeared on behalf of the assessee. The Ld. DR brought to our notice directions issued by learned DRP dated 29.11.2016 u/s 144C(5) of the 1961 Act wherein there is reference to the order of the tribunal in assessee s own case in ITA no. 8672/Mum/2010 and 7010/Mum/2011 for AY 2007-08 and 2008-09 respectively wherein the issue was decided by tribunal in favour of the assessee by holding that service tax shall not form part of the gross receipts which are to be considered for computing presumptive tax u/s 44B of the 1961 Act. 6. We have heard contention of the Ld. DR and perused the material on record including orders of the tribunal in assessee s own case in ITA no. 8672/Mum/2010 and 7070/Mum/2011 for AY 2007-08 and 2008-09 respectively wherein the tribunal de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rom operation of shipping be taxed under section 44B of the Income Tax Act on presumptive basis at the rate of 7.5% of the aggregate amount as per the provisions of section 44B of the Act read with Article 9 of the DTAA between India and Korea. The controversy involved in this appeal is as to whether the service tax collected during the year should be a part of the gross receipts for the purpose of the computation of income or the gross receipts are to be taken exclusive of sales tax receipts. The Assessing Officer (hereinafter referred to as the AO) while relying upon the Authority of Advance Ruling (AAR) in the case of Siem Offshore Inc reported in (2011) 337 ITR 027 observed that the gross receipts should be taken inclusive of the service tax for the purpose of computation of income of the assessee under section 44B of the Act. While holding so, the AO also relied upon the decision of the Delhi Bench of the Tribunal in the case of DDIT (International Taxation) vs. Technip Offshore Contracting BE ITA No.4613/Del/2007 vide order dated 16.01.09 wherein the Delhi Tribunal has held that since the service tax collected by the assessee was directly in connection with the services a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accordingly the same cannot be included in the total receipts for determining the presumptive income. The co- ordinate bench of the Tribunal, thus, in the own case of the assessee has decided the issue in favour of the assessee. Following the said decision, the co-ordinate bench of the Tribunal, in the own case of the assessee for A.Y. 2008-09, has again observed that the issue is covered in the assessee s own case for A.Y. 2007-08 and thus has upheld the order of the Ld. CIT(A) holding that the service tax since is a statutory liability and does not involve an element of profit and the same being collected by the service provider from his customers on behalf of the government, accordingly cannot be included in the total receipts for determining the presumptive income under section 44B of the Act. Similar view has been taken by the DRP in the own case of the assessee for A.Y. 2012- 13. The co-ordinate bench of the Tribunal in the case of Islamic Republic of Iran Shipping Lines vs. Dy.DIT ITA No.4877/M/2014 for A.Y. 2010-11 vide order dated 17.02.16 has observed that though the co-ordinate bench of the Tribunal in the case of M/s. China Ship Container Lines (Hong Kong) Company Ltd ..... X X X X Extracts X X X X X X X X Extracts X X X X
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