E.C. BOSE & CO. PVT. LTD.,KOLKATA vs. DCIT, CIRCLE-11, KOLKATA

The assessee in the present case is a Company, which is engaged in the business of providing Port related services, such as Stevedoring, Cargo Handling, Container Documentation, Inter-Port Transaction, etc. The returns of income for the years under consideration were filed by it

Against the orders passed by the Assessing Officer under section 147/143(3) for both the years under consideration, appeals were preferred by the assessee before the ld. CIT(Appeals) and since there was no satisfactory compliance on the part of the assessee to the notices issued by him fixing the said appeals for hearing from time to time, the ld. CIT(Appeals) proceeded to dispose of the appeals of the assessee vide a common appellate order dated 16.02.2018 passed ex-parte. In the said order, he held by relying on the decision of the Hon’ble Delhi High Court in the case of CIT –vs.- Noble & Hewitt (India) (P) Limited (305 ITR 324) that the disallowance under section 43B could be made only if the service tax collection had been routed by the assessee-company through its Profit

We have heard the arguments of both the sides and also perused the relevant material available on record. The ld. Counsel for the assessee has submitted that even though the decision of the ld. CIT(Appeals) in holding that the disallowance made by the Assessing Officer under section 43B in both the years under consideration was not sustainable if the service tax collected by the assessee-company had not been routed through its Profit & Loss Account, was duly supported by the decision of the Hon’ble Delhi High Court in the case of Noble & Hewitt (India) (P) Limited (supra), he was not justified to set aside the matter for verification as he was no more having such power to set aside the matter to the Assessing Officer. He has submitted that the Assessing Officer, therefore, has not complied with the direction given by the ld. CIT(Appeals) while setting aside the issue under consideration to the Assessing Officer vide his impugned order and urged that such direction may be given by the Tribunal so that the Assessing Officer will be able to carry out the necessary verification and decide the issue under consideration. Keeping in view all the facts of the case as well as the relevant provisions of the Act, we are inclined to accept this contention of the ld. Counsel for the assessee. Even the ld. D.R. has not raised any objection for sending the matter back to the Assessing Officer for the necessary verification. We accordingly restore the common solitary issue involved in both these appeals of the assessee relating to disallowance under section 43B to the file of the Assessing Officer with a direction to verify as to whether the service tax collection had been routed by the assessee-company through its Profit & Loss Account and accordingly allow appropriate relief to the assessee on the issue keeping in view the

In the result, both the appeals of the assessee are treated as allowed for statistical purposes. Order pronounced in the open Court on July 01, 2020.