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TMI Blog2019 (1) TMI 457X X X X Extracts X X X X X X X X Extracts X X X X ..... principles of law laid down by the Hon’ble Delhi High Court and further covered by the decision of the coordinate Bench in assessee’s own cases for the assessment years 2007-08 and 2008-09, we do not find any reason to deviate from the view taken by the Ld. DRP. Hence, we uphold the DRP directions issued u/s 144C (5) of the Act holding that the same does not suffer from any factual or legal infirmity to interfere with. - ITA No. 965/MUM/2016 - - - Dated:- 1-10-2018 - Shri B.R. Baskaran (AM) And Shri Ram Lal Negi (JM) For the Assessee : None For the Revenue : Shri Samuel Darse (CIT DR) ORDER PER RAM LAL NEGI, JM This appeal has been filed by the revenue, against the Dispute Resolution Panel directions dated 24.11 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... presumptive income u/s 44B of the Income tax Act, 1961 (hereinafter Act ) without appreciating the fact that the Service tax collected by the assessee directly in connection with service and facilities as spelt out in section 44B (2) of the Act and once an assessee opts to come under section 44N, there is no scope of any calculating or re-calculation of amount shown as payable in the contract, and doing so would defeat the very object of presumptive taxation, namely to avoid all complications in determining the tax liability of an assessee opting for or coming under that provision. 4. This appeal was fixed for hearing on 04.07.2018. However, on the said date when the case was called out for hearing, none appeared on behalf of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in question in favour of the assessee by following the decision of Hon ble Delhi High Court rendered in the case of DDIT vs. Mitchell Drilling International Pvt. Ltd. ITA No. 403/2013 and 384/2015 dated 28.09.2015. The relevant part of the directions of the Ld. DRP reads as under:- 2.3. We have considered the arguments and submissions of the assessee. We agree with the contentions of the assessee that the issue is covered in favour of the assessee in light of recent Delhi High Court decision Mitchell Drilling International Pvt. Ltd. (ITA No. 403/2013 and 384/2015 dated 28.09.2015) where in Court has held that service tax would not form part of gross receipts. Relevant portion of observations is reproduced as under;- .. for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecisions cited by the assessee. 2.3.2. Further, section 44B(2) covered amount in connection with carriage of goods, passengers, etc. The explanation thereto clarifies that the amounts in connection with the carriage would include demurrage charges. handling charges, and other amounts of a similar nature . Thus what is sought to be included are the charges recovered from the consignor of the cargo as a consideration for the transportation . Service tax being a mandatory statutory levy , cannot be said to be in the nature of charges by the shipping company towards the carriage. 2.3.3. Section 44B of the Act covers amounts paid/payable to or received/deemed to be received by or on behalf of a non-resident assessee engaged ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... service tax being in the nature of statutory payment and is being collected on behalf of Government, we agree with the contention of the assessee that it cannot be included in the gross receipts for the purpose of computing presumptive income of the assessee u/s 44B of the Act. We therefore direct the AO to delete the addition on account of service tax, after verification of payments, proposed to be made u/s 44B of the Act. This objection is therefore accepted. 7. We notice that the directions of the DRP are based on the findings of the Hon ble Delhi High Court in the case of DDIT vs. Mitchell Drilling International Pvt. Ltd. (supra). Moreover, the issue involved in the present case is covered in favour of the assessee by the order of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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