Orient Overseas Container Line Limited Vs DCIT (ITAT Mumbai)
ITAT Mumbai held that Goods and Services Tax (GST) amount while computing presumptive income under section 44B of the Income Tax Act cannot be included. Thus, issue decided in favour of assessee.
Facts- The present appeal has been filed by the assessee against final assessment order dated 12.07.2023 passed in pursuance of direction given by DRP. Assessee has mainly contested that GST amount cannot be considered for the purpose of computing presumptive income under section 44B of the Income Tax Act.
Conclusion- Held that if it is held that Section 145A are applicable for computing deemed income u/s.44B and GST is added to the specified amounts and provisions of Section 29 are invoked, then deduction of GST paid should be allowed while computing income under the head ”profits and gains” of business or profession as per Section 43B. Even otherwise also Section 44B over rights Section 28-43A and 43B and therefore, in case if department seeks to add GST on the turnover for the purpose of calculating the profit u/s.44B, then, deduction u/s.43B has to be allowed if it is paid on or before the due date and similarly it can be disallowed once GST has not been paid within the due date. However, this is purely academic, contention which has been raised because we have already held that for the purpose of Section 44B only specified amount mentioned in the sub-Section 2 of Section 44B alone is the subject matter of computation of profit @7.5% and Section 145A has no applicability. Thus we hold that while computing income u/s.44B, GST cannot be included.
