Case Law Details
Nanjunda Renuka Aradhya Vs ACIT (ITAT Bangalore)
Conclusion: When assessee collected the service tax from its customers and had not remitted to Government Exchequer, the same had to be disallowed u/s 43B.
Held: AO noticed that assessee in the balance sheet filed for the AY. 2010-11 had shown Rs.10,82,023 as service tax payable. Assessee had collected service tax and not remitted to government account. Assessee should have considered service tax collected and not remitted as income for the year under the provisions of section 43B of the Income Tax Act. Hence the service tax payable of Rs.10,82,023 was disallowed under the provisions of section 43B. Accordingly an amount of Rs.10,82,023 was added to the returned income. It was held that the Bangalore Bench of the Tribunal in the case of Boraiah Shivananjaiah v. ACIT held that when assessee collected the service tax from its customers and had not remitted the Government Exchequer, the same had to be disallowed u/s 43B. AO was directed to examine whether assessee had actually collected the service tax from its customers and not remitted to the Government Exchequer. In such an event, the disallowance u/s 43B would have to be upheld.
FULL TEXT OF THE ORDER OF ITAT BANGALORE
This appeal at the instance of the assessee is directed against CIT(A)’s order dated 06.11.2017. The relevant assessment year is 2010-2011.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
Author Bio
