UDIT FINANCIAL SERVICES PVT. LTD.,KOLKATA vs. D.C.I.T.,CIRCLE-6(1), KOLKATA

This is an appeal filed by the assessee directed against the order of the Commissioner of Income Tax (Appeals)-2, Kolkata [‘CIT(A)’ for short] dated 03.10.2019 u/s 250 of the Income Tax Act, 1961 (‘the Act’ for short) for AY 2012-13.

The assessee in this case has offered to tax an amount of ₹10 lakh under the Income Declaration Scheme, 2016. The amount of ₹10 lakh, was originally claimed as a deduction being payment of commission. This declaration was accepted by the Pr.CIT-2, Kolkata in Form no.-4 on 06.10.2017. The assessee has claimed that service tax of ₹1,03,000/- was collected from it by M/s. Silver Point Infratech Ltd. to whom the alleged commission was paid and that M/s. Silver Point Infratech Ltd. has paid the amount in question as service tax. This service tax payment was claimed as a deduction. 3. The Revenue’s contention is that when the payment of commission itself is not genuine, the payment of service tax to M/s. Silver Point Infratech Ltd. is also a bogus payment. 4. When the service tax in question has been paid to the Service Tax Department by M/s. Silver Point Infratech Ltd., and the same has been recovered from the assessee, this Assessment Years: 2012-13 Udit Financial Services Pvt. Ltd. should be allowed as an expense and no addition can be made. Hence, the same is deleted and the appeal of the assessee is allowed. 5. In the result, the appeal of the assessee is allowed. Kolkata, the 26th February, 2020.