TaxTMI 
TaxTMI 
2016 (10) TMI 885
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....ssee. The assessee-company filed its objections thereto before the DRP-II, Mumbai. The DRP-II issued its directions on the assessee's objection under section 144C(5) of the Act vide order dated 18.09.2014, pursuant to which the Assessing Officer (AO) has passed the impugned order under section 143(3) r.w.s. 144C(113) of the Act vide order dated 14.11.2014. 3. In this appeal the grounds raised by the assessee are as under: - "GROUND 1 : Inclusion of service tax for the purpose of presumptive income under Section 44B of the Income- tax Act, 1961 ('the Act') 1.1 On the facts and in the circumstances of the case and in law, the learned DDIT has erred in including an amount of INR 1,79,11,894 being 7.5 percent of the service tax collected from customers and paid to Government (i.e. INR 23,88,25,253) for the purpose of computing presumptive income under Section 44B of the Act. 1.2 The Appellant humbly prays that the learned DDIT be directed not to include service tax collected and paid for the purpose of computing the presumptive income under Section 44B of the Act. 2. GROUND 2: Non consideration of correct amount of service tax collected and paid 2.1 Without pr....
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....t. Before us, the learned A.R. for the assessee submitted that the issue for consideration in these grounds has been considered and allowed in favour of the assessee by the decisions of Coordinate Bench of this Tribunal in assessee's own case for assessment years 2007-08 and 2008-09 in (2013) 60 SOT 86 (Mum Trib) and for A.Y. 2010-11 in ITA No.7494/Mum/2013 & 524/Mum/2014 dated 31.07.2015. It was prayed that in view of the above, the assessee's appeal on this issue be allowed. 4.2 Per contra, the learned D.R. for Revenue supported the orders of the authorities below which had placed reliance on the decision of the Coordinate Bench of this Tribunal in the case of M/s. China Shipping Container Lines (Hong Kong) Company Ltd. in ITA No. 8516/Mum/2010 dated 23.08.2013 in which the view of the authorities below in including the service tax receipt in the gross receipts taken for computing the presumptive profits of the assessee was upheld. 4.3 In rejoinder, the learned A.R. submitted that apart from this issue being covered in favour of the assessee by the decisions of Coordinate Benches of this Tribunal in the assessee's own case for assessment years 2007-08, 2008-09 and 2010-11 (....
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....because it has been collected from the customers on behalf of the Government and cannot be included in the total receipts. We find that the Tribunal in assessee's own case has taken a note of various decisions for and against the assessee and has reached to the following conclusion :- 6. We have considered the rival submissions and also perused the relevant material on record. We have also carefully gone through the various judicial pronouncement relied upon by the Ld. Representatives of both the sides in support of their respective stands on the issue. It is observed that the Assessing Office in his impugned orders and Ld. DR at the time of hearing before us have heavily relied on the decision of Hon'ble Uttarakhand High Court in the cases of Halliburton Offshore Services Inc. (supra), Sedco Forex International Inc. (supra) and Trans Ocean Offshore Inc. (supra) in support of the Revenue's that the amount of service tax collected by the Assessee should be included in the gross receipts for the purpose of computing the total income as per the provisions of section 44B. It is observed that reliance on the said decisions was placed by the Revenue in the case of DIT Vs. Schi....
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....ilar issue in favour of the assessee holding that reimbursement of service tax, being a statutory liability, would not involve any element of profit and the same therefore could not be included in total receipts for determining presumptive income under Section 44BB. 8. Keeping in view all the judicial pronouncement discussed above, we are of the view that the preponderance of judicial opinion is in favour of the Assessee on the issue and keeping in view the same, we decide this issue in favour of the assessee holding that the amount of service tax, being in the nature of statutory payment which does not involve any element of profit, cannot be included in the gross receipts for the purpose of computing the presumptive income of the assessee under section 44B. Ground no. 1 of the Assessees Appeal for AY 2007-08 and ground No. 2 of the Assessees Appeal for AY 2008-09 are accordingly allowed". 5. Since in assessee's own case in the earlier years, one view has been taken therefore, consistent with the same precedence, we also hold that the amount of service tax cannot be included in the gross receipts for the purpose of computing the 'Presumptive income' of the assessee u/s 44B. ....
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....in nature and therefore no adjudication is called for thereon at this juncture. 6. GROUND 3 (3.1 to 3.3) : Short credit of advance tax and tax deducted at source (TDS) 6.1 In this ground, the assessee contends that the AO in the order of assessment had granted it short credit of TDS amounting to Rs. 34,583/- and short credit for Advance Tax amounting to Rs. 10,95,525/- and that inspite of subsequently filing a rectification application under section 154 of the Act, the AO has not rectified the mistake. In this regard, after hearing both parties, we direct the AO to consider, examine and verify the assessee's claim of grant of short credit of Advance Tax of Rs. 10,95,525/- and TDS of Rs. 34,583/- while giving effect to this order, after affording the assessee of adequate opportunity of being heard in the matter and to file details/submissions required in this regard. Consequently, ground No. 3 of the assessee's appeal is treated as allowed for statistical purposes. 7. Grounds Nos. 4 & 5: Charge of interest under section 234C and 234D of the Act. 7.1 In these grounds, the assessee denies itself liable to be charged interest under sections 234C and 234D of the Act. The cha....