Boraiah Shivananjaiah
vs
Asst.Commissioner of Income Tax
ITA No. 680/Bang/2020
(Assessment Year: 2014-15)
THE INCOME TAX APPELLATE TRIBUNAL, BANGALORE BENCHES, “B” BENCH : BANGALORE
The AO recorded the finding that the assessee has actually collected the service tax from it customer and not remitted to the Government exchequer. The Assessing Officer completed assessment relying on the various decisions including the Bombay High Court in the case of CIT Vs. Ovira Logistics P. Ltd wherein it was held that the service tax has not been shown as expenditure in the P&L A/c while computing income of the assessee.
The assessee carried the appeal before the CIT(A). The CIT(A), after giving various notices, passed the ex-parte order by deleting the addition made towards ESI/PF. However, he sustained the addition made towards non-payment of service tax by invoking provisions of Section 43A of the Act. Against the same, the assesse is in appeal before.
The assessee has made a plea that it has not been actually verified by the AO and without examining, the AO took a decision that it has been collected and the same was confirmed by the CIT(A) in the ex-parte order.
After hearing the contentions of both the parties, the ITAT bench led by Beena Pillai, Judicial member, and Chandra Poojari, Accountant member observed that “In our opinion, it has to be verified in the light of the judgment of Hon’ble Bombay High Court in the case of CIT Vs. Ovira Logistics P. Ltd 377 ITR 129, cited supra. Accordingly, we remit this issue to the file of AO to examine whether the assessee actually collected and received the amount and kept with him without depositing to Government exchequer. If the assessee actually received from its customers and kept it without depositing the same within due date of filing of return of income u/s.139(1) of the Act, then only the AO has to invoke the provisions of Section 43B and bring that amount to tax. Ordered accordingly.”
The appeal of the assessee was partly allowed for statistical purposes.