Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: VAT Audit :: list of goods taxed at 4% :: TAX RATES - GOODS TAXABLE @ 4% :: articles on VAT and GST in India :: empanelment :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: VAT RATES :: TDS :: ACCOUNTING STANDARD :: due date for vat payment :: ARTICLES ON INPUT TAX CREDIT IN VAT :: Central Excise rule to resale the machines to a new company :: cpt :: form 3cd :: ACCOUNTING STANDARDS
 
 
From the Courts »
  Micro Spacematrix Solution P Ltd vs. ITO (ITAT Delhi)
 Micro Spacematrix Solution P Ltd vs. ITO (ITAT Delhi)
 CIT vs. Greenfield Hotels & Estates Pvt. Ltd (Bombay High Court)
 IndiaBulls Financial Services Ltd vs. DCIT (Delhi High Court)
 Maharao Bhim Singh of Kota vs. CIT (Supreme Court)
 Ravneet Takhar Vs. Commissioner Of Income Tax Ix And Ors.
 Jaiprakash Associates Ltd. Vs. Commissioner Of Income Tax
 Formula One World Championship Limited Vs. Commissioner Of Income Tax, International Taxation-3 And Anr.
 Commissioner Of Income Tax International Taxation-3 Delhi Vs. Formula One World Championship Ltd. And Anr.
 Reliance Communications Ltd vs. DDIT (ITAT Mumbai)
  Sushila Devi vs. CIT (Delhi High Court)

Dy Commissioner of Income Tax 10(2), Room No. 432, 4th Floor, Aayakar Bhavan, M K Road, Mumbai 400 020 Vs. M/s Gopinath Engineering Co Pvt Ltd, 15C, Satyam Shivam Sundaram, M G Road, Ghatkopar East, Mumbai-400 077
September, 09th 2015
                                        1
                                                          M/s Gopinath Engineering Co Pvt Ltd
                                                                     ITA No. 7606/Mum/2013
                                                                       CO No. 113/Mum/2015

               ""    

           IN THE INCOME TAX APPELLATE TRIBUNAL
                 MUMBAI BENCH "G", MUMBAI

    BEFORE SHRI AMIT SHUKLA, JUDICIAL MEMBER AND
         SHRI RAJESH KUMAR, ACCOUNTANT MEMBER

                      ITA No. : 7606/Mum/2013
                       (Assessment year: 2010-11)
Dy Commissioner of Income Tax ­         Vs      M/s Gopinath Engineering Co Pvt
10(2),                                          Ltd,
Room No. 432, 4th Floor,                        15C, Satyam Shivam Sundaram,
Aayakar Bhavan, M K Road,                       M G Road, Ghatkopar East,
Mumbai 400 020                                  Mumbai-400 077
 (Appellant)                                       (Respondent)
                        Appellant by        :   Shri B D Naik
                      Respondent by         :   Shri Surendra Damle

               Cross Objection No. 113/Mum/2015
       Arising out of ITA No. : 7606/Mum/2013, AY 2010-11
                     (Assessment year: 2010-11)
M/s Gopinath Engineering Co Pvt         Vs      Dy Commissioner of Income Tax ­
Ltd,                                            10(2),
15 Satyam C, M G Road, Ghatkopar                Room No. 432, 4th Floor,
East, Mumbai 400 077                            Aayakar Bhavan, M K Road,
   .:PAN: AAACG 1935 D                          Mumbai 400 020
Cross objector  (Appellant)                        (Respondent)
          Appellant Cross Objector by       :   Shri Surendra Damle
                       Respondent by        :   Shri B D Naik

           /Date of Hearing
                                                    : 01-09-2015
          /Date of Pronouncement                    : 04-09-2015

                                        
                                        ORDER

        , . .:
      PER AMIT SHUKLA, JM:

             The aforesaid appeal has been filed by the revenue and
      Cross Objection by the assessee against the impugned order dated
      15.10.2013, passed by CIT(A)-21 Mumbai, for the quantum of
      assessment passed u/s 143(3) r.w.s. 147 for the assessment year
      2010-11 on following grounds:

             1.     On the facts and in the circumstances of the case as
                    well as in law, the Ld. CIT(A) erred in deleting the
                    disallowance made by the AO u/s 43B of the Act made
                              2
                                             M/s Gopinath Engineering Co Pvt Ltd
                                                        ITA No. 7606/Mum/2013
                                                          CO No. 113/Mum/2015
            on account of late payment of Service Tax liability of Rs.
            1,29,79,838/-.

      1.1      On the facts and in the circumstances of the case as
               well as in law, the Ld. CIT(A) erred in not appreciating
               the fact that the assessee made the payment of the
               Service Tax liability amounting to Rs. 1,02,21,606/-
               after filing of Return of Income for the current year.

      1.2      On the facts and in the circumstances of the case as
               well as in law, the Ld. CIT(A) erred in not appreciating
               the fact that the balance Service Tax payment made on
               amount of late payment of Employees' Contribution of
               PF amounting to Rs. 29,69,876/-.

      2.    On the facts and in the circumstances of the case as
            well as in law, the Ld. CIT(A) erred in deleting the
            disallowance by the AO u/s 43B of the Act made on
            account of late payment of Employees' Contribution to
            PF amounting to Rs. 29,69,876/-.

      2.1   On the facts and in the circumstances of the case as
            well as in law, the Ld. CIT(A) erred in not applying the
            ratio of the decision of the Hon'ble Mumbai Tribunal in
            the case of LKP Securities Ltd in ITA No. 638/M/2012
            w.r.t. late payment of Employees' Contribution to PF by
            the assessee company".

2.    During the course of the assessment proceedings, the
Assessing Officer on the perusal of the Balance Sheet noticed that
there is a mention in Schedule "H"', regarding unpaid service tax
liability and `Employees contribution to provident fund' for sums
amounting to Rs. 1,29,79,838/- and Rs. 29,69,876/- respectively.
The Assessing Officer held that such a payment should be
disallowed u/s 43B as there has been delayed payment on account
of both, Employee's contribution to PF and delay in payment of
Service Tax.

3.    The Ld. CIT(A), so far as disallowance of service tax liability
is concerned, gave a very important finding of fact from the perusal
of the records that the assessee had not deducted amount of Rs.
1,29,79,838/- on account of service tax liability from the profit and
loss account and hence there was no deduction claimed in the P&L
                            3
                                           M/s Gopinath Engineering Co Pvt Ltd
                                                      ITA No. 7606/Mum/2013
                                                        CO No. 113/Mum/2015
Account so as to reduce the profit of the business during the year,
therefore, Assessing Officer could not have disallowed this amount
u/s 43B. Further, he held that assessee had to pay the service tax
after collecting the service tax from the payers as per the Service
Tax Rules, which the assessee had done as per the details
mentioned at page 4 of the appellate order. The relevant
observation and finding of the CIT(A) in this regard are as under :-
      I have considered the facts and circumstances of the case.
      During the year under consideration AO had added Rs.
      1,29,79,838/- for non-payment of service tax liability as on
      31.03.2010. On verification of the records of the appellant,
      appellant had not deducted this amount from the P&L
      account, hence, the deduction was not claimed in P&L account
      to reduce the profit of the business during the year. Therefore,
      AO could not disallow this amount u/s 43B as appellant had
      not claimed this amount in the P&L account in view of Delhi
      High Court in the case of CIT vs Noble & Hewitt (I) P Ltd
      (2008) 166 Taxman 48 (Delhi) wherein it is held as under:
            "In our opinion since the assessee did not debit the
            amount to the profit and loss account as on expenditure
            nor did the assessee claim any deduction in respect of
            the amount and considering that the assessee is
            following the mercantile system of accounting, the
            question of disallowing the deduction not claimed would
            not arise".


      In the case of ACIT vs Real Image Media Technologies (P) Ltd
      (2008) 116 TTJ 964 (Chennai) wherein it is held as under:
            "(2009) 21 ITD 461 (Chennai) (TM) Section 43B can only
            be invoked when the assessee claims deduction for any
            sum payable by way of tax or duty, under any law for
            the time being in force, and, as such, whether neither
            such deduction is claimed nor charge is made to the
                           4
                                           M/s Gopinath Engineering Co Pvt Ltd
                                                      ITA No. 7606/Mum/2013
                                                        CO No. 113/Mum/2015
           profit and loss account, there is no question of
           disallowing the amount. Having regard to the facts, the
           Assessing Officer was not justified in marking the
           addition under section 43B".
     In view of the above decision, it is clear that addition u/s 43B
     is applicable and appellant had claimed deduction in P&L
     account. In the instant cases appellant had not claimed any
     deduction, hence, AO cannot disallow the amount. Moreover
     till July 2011, the appellant had to pay service tax only after
     collecting the service tax from the payers as per the service tax
     rules. The appellant had collected the service tax later and
     paid the same as under:
          Date                                  Amount
    BEFORE FILING OF ITR
    06.05.2010                                           1,043,679.00
    06.05.2010                                              62,972.00
    06.05.2010                                             677,202.00
    30.06.2010                                             974,379.00
    TOTAL                                                2,758,232.00


          Date                                    Amount
    AFTER FILING OF ITR
    01.11.2010                                             999,100.00
    15.11.2010                                             499,550.00
    23.11.2010                                           1,249,905.00
    25.11.2010                                           1,999,951.00
    27.11.2010                                           2,499,501.00
    30.11.2010                                           1,249,905.00
    07.12.2010                                           1,723,694.00
    GRAND TOTAL                                         12,979,838.00


     As the appellant had paid the service tax and also not claimed
     the deduction in profit and loss account, sec. 43B of the IT Act
     Is not applicable in view of the above mentioned case. Hence
     ground of appeal is allowed".

Regarding Employees' contribution to PF dues of Rs. 29,69,876/-,
he held from the perusal of records that the same has been paid
much before the due date of filing of the return of income,
                                  5
                                                    M/s Gopinath Engineering Co Pvt Ltd
                                                               ITA No. 7606/Mum/2013
                                                                 CO No. 113/Mum/2015
     therefore, following the decision of Hon'ble Supreme Court in the
     case of CIT vs Alom Extrusions Limited, reported in 319 ITR 306,
     he allowed the said deduction.

     4.    After hearing both the parties and on perusal of the
     impugned order, we find that so far as disallowance on account of
     non-payment of service tax liability u/s 43B is concerned, the
     same is not tenable, firstly, the Ld. CIT(A) has given a categorical
     finding of fact that the assessee had not claimed the amount of
     Service Tax Liability of Rs. 1,29,79,838/- in the profit and loss
     account and hence there was no question of making disallowance
     and Secondly, the assessee had collected the Service Tax and paid
     later, on the dates as incorporated above. Thus, no disallowance
     u/s 43B can be sustained under these facts and circumstances.
     Accordingly,     the   finding   of   CIT(A)    is    upheld.       Regarding
     disallowance of Employee's contribution to PF also, we uphold the
     order of the CIT(A) as it is not disputed before us that the PF dues
     though have been paid beyond the due date of Provident Fund Act,
     but much before the due date of filing of return of income u/s
     139(1) which is allowable in view of the decision of Hon'ble
     Supreme Court. Thus, the order of the CIT(A) on this score also is
     upheld.




     5.    Regarding Cross Objection, it has been admitted that it is in
     support of the order of the CIT(A). Accordingly, Cross Objections
     raised by the assessee is treated as allowed in view of the finding
     given in the Departmental appeal.

     6.    In the result, appeal of the revenue is dismissed and Cross
     Objection of the assessee are allowed.
     Order pronounced in the open court on 4th September, 2015.
               Sd/-                                                  Sd/-
     (RAJESH KUMAR)                                          (AMIT SHUKLA)
   ACCOUNTANT MEMBER                                       JUDICIAL MEMBER

Mumbai, Date: 4th September, 2015
                                  6
                                               M/s Gopinath Engineering Co Pvt Ltd
                                                          ITA No. 7606/Mum/2013
                                                            CO No. 113/Mum/2015




 /Copy to:-

     1)  /The Appellant.
     2)    /The Respondent.
     3) The CIT(A) -21, Mumbai.
     4) The CIT­ 10, Mumbai.
     5)   "",   , /
        The D.R. "G" Bench,   Mumbai.
     6)   
        Copy to Guard File.

                                             /By Order
      / / True Copy / /



                                            / 
                                            ,                 
                                        Dy./Asstt. Registrar
                                         I.T.A.T., Mumbai

*  ..
*Chavan, Sr.PS

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2016 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Privacy Policy

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions