DCIT, New Delhi V. M/s Disha Security & Manpower Pvt. Ltd., New Delhi

ITA 5649/DEL/2016

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 5247 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 6 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-05-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 03-11-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Depreciation
• Section: 43B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: B NEW DELHI BEFORE SHRI N. K. BILLAIYA, ACCOUNTANT MEMBER & SHRI K.N. CHARY, JUDICIAL MEMBER ITA NO-5649/DEL/2016 (ASSESSMENT YEAR: 2012-13) DCIT CIRCLE-7(2), ROOM NO. 403 C. R. BUILDING, I. P. ESTATE NEW DELHI VS DISHA SECURITY & MANPOWER PVT. LTD. 77, RAO HARNATH MARG, KAPASHERA NEW DELHI PAN AABCD2407L REVENUE BY SH. ABHISHEK KUMAR, SR. DR ASSESSEE BY SH. AMAR JEET SINGH, CA ORDER PER K. NARSIMHA CHARY, J.M. CHALLENGING THEORDER DATED 22/08/2016 IN APPEAL NO. 14/2015-16 PASSED BY THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-3,NEW DELHIFOR A.Y. 2012-13, REVENUE PREF ERRED THIS APPEAL. 2. BRIEFLY STATED RELEVANT FACTS ARE THAT THE ASSES SEE IS ENGAGED IN MANPOWER SUPPLY. FOR THE ASSESSMENT YEAR 2012-13 , THEY FILED THEIR RETURN OF INCOME ON 30.09.2012 DECLARED AN IN COME OF DATE OF HEARING 15.05.2019 DATE OF PRONOUNCEMENT 17.05.2019 ITA NO. 5649/DEL/2016 2 RS.36,31,523/- AND REVISED THE SAME ON 20.07.2013 A T AN INCOME OF RS. 36,35,500/-. DURING THE COURSE OF ASSESSMEN T PROCEEDINGS, AFTER CONSIDERING THE DETAILS OF SERVICE TAX LIKE C HALLANS ETC FURNISHED BY THE ASSESSEE, LD. ASSESSING OFFICER FOUND THAT AN AMOUNT OF RS. 1,19,12,845/- TOWARDS SERVICE TAX WAS DEPOSITED ON 24/12/2012 AFTER RECEIVED THE RETURN OF INCOME AND, THEREFORE, WHILE RECORDING A FACT THAT THE ASSESSEE HAD DEBITE D SUCH AN AMOUNT TO THE PROFIT AND LOSS ACCOUNT, LD. ASSESSIN G OFFICER ADDED BACK TO THE INCOME OF THE ASSESSEE AND ASSESSED THE IR INCOME AT RS.1,55,44,370/-. 3. IN THE APPEAL PREFERRED BY THE ASSESSEE, LD. ASS ESSING OFFICER REAPPRAISED ALL THE FACTS AND OBSERVED THAT THE ASS ESSEE HAD NOT DEBITED THE AMOUNT OF SERVICE TAX IN THE BOOKS OF A CCOUNT NOR CLAIMED IT AS DEDUCTION OUT OF THE TAXABLE PROFIT F OR THE YEAR UNDER CONSIDERATION AND, THEREFORE, THE ADDITION OF RS. 1 ,19,12,845/- WAS UNSUSTAINABLE AND, THEREFORE, DELETED THE SAME. 4. REVENUE IS THEREFORE IN THIS APPEAL BEFORE US ST ATING THAT THE LD. ASSESSING OFFICER IS JUSTIFIED IN ADDING SUCH A MOUNT U/S 43B OF THE ACT TO THE INCOME OF THE ASSESSEE SINCE IT REPR ESENTS THE UNPAID SERVICE TAX AND LD.CIT(A) ERRED IN DELETING THE ADDITION BASING ON THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. NOBLE & HEWITT (I) PVT. LTD. 305 ITR 324. 5. IT IS THE ARGUMENT OF THE LD. DR THAT INASMUCH A S THE ASSESSEE DEPOSITED THE SERVICE TAX TO THE TUNE OF R S.1,19,12,845/- ITA NO. 5649/DEL/2016 3 ON 24/12/2012 AFTER FILING OF THE RETURN OF INCOME, THE LD. A.O IS JUSTIFIED IN ADDING IT BACK TO THE INCOME OF THE AS SESSEE U/S 43B OF THE ACT. LD. DR SUBMITTED THAT SUCH AN AMOUNT WAS DEBITED TO THE PROFIT AND LOSS ACCOUNT. 6. PER CONTRA, IT IS THE ARGUMENT OF THE LD. AR THA T A SUM OF RS. 2,65,16,755/- WAS PAYABLE TOWARDS SERVICE TAX AT TH E END OF THE YEAR AND OUT OF THIS AMOUNT A SUM OF RS.1,19,12,845 /- WAS DEPOSITED ON 24/12/2012 AFTER THE DATE OF FILING O F THE INCOME TAX RETURN, BUT THE BALANCE WAS PAID BEFORE THE DUE DAT E. HE FURTHER SUBMITTED THAT SERVICE TAX IS NOT COVERED U/S 43B O F THE ACT. SINCE, NO DEDUCTION OF THE SAME WAS CLAIMED OUT OF PROFITS OF THE ASSESSEE COMPANY AND THE MATTER IS DULY COVERED BY THE DECISION OF THE HONBLE DELHI HIGH COURT IN CASE OF NOBEL & HEWITT (I) PVT. LTD. SUPRA 305 ITR 324 AND A NUMBER OF OTHER CASES, LD. CIT(A) IS JUSTIFIED IN DELETING THE SAME. 7. WE HAVE HEARD GONE THROUGH THE RECORD IN THE LIG HTS OF THE SUBMISSIONS MADE ON EITHER SIDE. FIRST OF ALL, ON A CONSIDERATION OF THE PROFIT AND LOSS ACCOUNT A COPY OF WHICH CAN BE FOUND AT PAGE NO. 9 OF THE PAPER BOOK, WE FIND THAT THE ASSESSEE CLAIMED EXPENSES UNDER FOUR HEADS, NAMELY, DIRECTCOST, EMPL OYEE BENEFIT EXPENSE, FINANCE COST AND DEPRECIATION AND AMORTIZA TION OF EXPENSES APART FROM OTHER EXPENSES VIDE SCHEDULES 14 TO 17 THEREOF, TO BE FOUND AT PAGE NO. 15 OF THE PAPER BO OK. THIS CLEARLY SHOWS THAT UNDER NONE OF THESE HEADS,THE SALES TAX COMPONENT IS ITA NO. 5649/DEL/2016 4 SHOWN. ON THE OTHER HAND, THE BALANCE SHEET OF THE COMPANY AT PAGE NO. 8 OF THE PAPER BOOK UNDER THE CURRENT LIAB ILITIES SHOW THAT THE ASSESSEE HAD TAKEN A SUM OF RS.4,99,40,195 /- UNDER OTHER CURRENT LIABILITIES WHICH ARE DETAILED IN NOTE NO. 6 WHICH IS UNDER TWO HEADS NAMELY, DUTY AND TAXES AND EXPENSES PAYAB LE. VIDE PAGE NO 18 OF THE PAPER BOOK, ACCOUNT OF DUTIES AND TAXES TO THE TUNE OF OF RS.3,94,44,804/- WAS SHOWN TO HAVE COMPR ISES OF RS. 2,65,16,755/- UNDER THE HEAD SERVICE TAX PAYABLE AT 10.3%. THESE DETAILS COULD BE FOUND AT PAGE NOS. 13 & 18 OF THE PAPER BOOK. 8. IT IS, THEREFORE, CLEAR FROM READING OF THE BALA NCE SHEET AND PROFIT AND LOSS ACCOUNT THAT THE ASSESSEE DID NOT D EBIT THIS AMOUNT OF RS.1,19,12,845/- TO THE PROFIT AND LOSS ACCOUNT BUT HAD DIRECTLY TAKEN IT TO THE BALANCE SHEET UNDER THE HEAD CUR RENT LIABILITIES ANDSUB HEAD OTHER CURRENT LIABILITIES. 9. WE ARE, THEREFORE, OF THE CONSIDERED OPINION THA T AN ERROR OF FACT HAD CREPT IN THE ORDER OF THE ASSESSMENTWHERE THE LD. ASSESSING OFFICER NOTED THAT THE ASSESSEE HAD DEB ITED THE AMOUNT OF SERVICE TAX TO THE PROFIT AND LOSS ACCOUNT. ON VERIFICATION OF THE FINANCIALS OF THE ASSESSEE,WE AGREE WITH THE FINDIN G OF THE LD.CIT(A) THAT THE ASSESSEE HAD NOT DEBITED THE AMOUNT OF SER VICE TAX IN THE BOOKS OF ACCOUNT AND NOR DID THEY CLAIM ANY DEDUCTI ON OUT OF THE TAXABLE PROFIT FOR THE YEAR UNDER CONSIDERATION. 10. LD.CIT(A) FOLLOWED THE BINDING PRECEDENT OF THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF NOBLE AND HEWITT (I) PVT. ITA NO. 5649/DEL/2016 5 LTD. (SUPRA) WHICH CANNOT BE FOUND FAULT WITH. IN THESE CIRCUMSTANCES, WE ARE OF THE CONSIDERED OPINION THA T THE GROUNDS OF APPEAL PREFERRED BY THE REVENUE ARE DEVOID OF ME RITS AND APPEAL IS LIABLE TO BE DISMISSED. WE, ACCORDINGLY DISMISS THE APPEAL OF THE REVENUE. 11. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 17.05.2019 SD/- SD/- (N. K. BILLAIYA) (K. NARSIMHA CHARY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 17.05.2019 R.N COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI ITA NO. 5649/DEL/2016 6 DATE OF DICTATION 15.05.2019 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 16.05.2019 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/PS DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT DATE ON WHICH THE FILE GOES TO THE BENCH CLERK DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER