DCIT, Circle-12(2), Kolkata, Kolkata v. M/S. Selvel Advertising Pvt. Ltd., Kolkata

ITA 2122/KOL/2014 | 2008-2009
Pronouncement Date: 30-09-2016 | Result: Dismissed

Appeal Details

RSA Number 212223514 RSA 2014
Assessee PAN AAECS8398C
Bench Kolkata
Appeal Number ITA 2122/KOL/2014
Duration Of Justice 1 year(s) 10 month(s) 11 day(s)
Appellant DCIT, Circle-12(2), Kolkata, Kolkata
Respondent M/S. Selvel Advertising Pvt. Ltd., Kolkata
Appeal Type Income Tax Appeal
Pronouncement Date 30-09-2016
Appeal Filed By Department
Order Result Dismissed
Bench Allotted B
Tribunal Order Date 30-09-2016
Date Of Final Hearing 20-06-2016
Next Hearing Date 20-06-2016
Assessment Year 2008-2009
Appeal Filed On 19-11-2014
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH B KOLKATA BEFORE SHRI WASEEM AHMED ACCOUNTANT MEMBER AND SHRI K.NARSIMHA CHARY JUDICIAL MEMBER ITA NO. 2065 /KOL/ 2013 & ITA NO.2122/KOL/2014 ASSESSMENT YEAR:2008-09 SELVEL ADVERTISING PVT. LTD. C/O M.L. SAHGAL & CO. NEELAM APARTMENTS 3 RD FLOOR FLAT 3E 61-B PARK STREET KOLKATA-700 016 [ PAN NO.AAECS 8398 C ] DCIT CIRCLE-12(2) P-7 CHOWRINGHEE SQUARE AAYAKAR BHAWAN 7H FLOOR KOLKATA-700 069 / V/S . / V/S . COMMISSIONER OF INCOME TAX P-7 CHOWRINGHEE SQUARE KOLKATA-700 016 M/S SELVEL ADVERTISING PVT. LTD. 10/1B DIAMOND HARBOUR ROAD KOLKATA-700 027 /APPELLANT .. /RESPONDENT /BY ASSESSEE SHRI J.P. KHAITAN ADVOCATE & SHRI TARUN KUMAR BANERJEE AR /BY RESPONDENT SHRI NIRAJ KUMAR CIT-DR & SHRI ALOKE NAG ADDL. CIT-DR /DATE OF HEARING 23-08-2016 /DATE OF PRONOUNCEMENT 30-09-2016 /O R D E R PER WASEEM AHMED ACCOUNTANT MEMBER:- THESE TWO APPEALS ASSESSEE HAS BEEN FILED RELATI NG TO ASSESSMENT YEAR (AY) 2008-09 PASSED BY COMMISSIONER OF INCOME TAX IV KO LKATA UNDER THE PROVISION OF SEC. 263 OF THE INCOME TAX ACT 1961 (HEREINAFTER R EFERRED TO AS THE ACT) VIDE MEMO. NO. CIT KOL-IV/KOL/263/2012-13/391-393 DATED 28.03.2011/01.05.2013. ITA NO.2065/KOL/2013 & 2122/KOL/2014 A. Y. 2008-09 SELVEL ADVERTISING PVT. LTD. VS. CIT-IV/DCIT CIR-12(2) KOL. PAGE 2 OTHER REVENUES APPEAL AGAINST THE ORDER OF COMMISS IONER OF INCOME TAX (APPEALS)- XII KOLKATA DATED 08.09.2014. ASSESSMENT WAS FRAME D BY ADDL. CIT RANGE-12 KOLKATA U/S 143(3) FOR AY 2008-09 VIDE HIS ORDER DA TED 21.12.2010. BOTH THE APPEALS ARE HEARD TOGETHER AND ARE BEING D ISPOSED OF BY WAY OF A CONSOLIDATED ORDER. SHRI J.P. KHITAN & SRI TARUN KUMAR BANERJEE LD. A DVOCATES APPEARED ON BEHALF OF ASSESSEE AND SRI NIRAJ KUMAR & SHRI ALOKE NAG LD. DEPARTMENTAL REPRESENTATIVES APPEARED ON BEHALF OF REVENUE. FIRST WE TAKE UP ASSESSEES APPEAL IN ITA NO. 2065/ KOL/2013 FOR A.Y. 08-09 . 2. FACTS IN BRIEF AS CULLED OUT FROM THE ORDER OF L OWER AUTHORITIES AND OTHER RELEVANT DOCUMENTS ARE THAT ASSESSEE IN THE PRESENT CASE A PRIVATE LIMITED COMPANY AND ENGAGED IN THE BUSINESS OF ADVERTISING. ASSESSE E FOR THE YEAR UNDER CONSIDERATION FILED ITS RETURN OF INCOME ON 30.09.2008 DECLARING TOTAL INCOME OF RS.1 93 10 736/-. THEREAFTER CASE WAS SELECTED FOR SCRUTINY AND NOTIC E U/S 143(2) OF THE ACT ISSUED. THE ASSESSMENT WAS FRAMED U/S. 143(3) OF THE ACT AT A T OTAL INCOME OF RS.3 5182 500/- BY MAKING CERTAIN ADDITIONS / DISALLOWANCES VIDE ORDER DATED 21.12.2010. 3. SOLE ISSUED RAISED BY ASSESSEE IN THIS APPEAL IS THAT LD. CIT ERRED IN TREATING THE ORDER PASSED BY ASSESSING OFFICER AS ERRONEOUS IN S O FAR AS PREJUDICIAL TO THE INTEREST OF REVENUE U/S 263 OF THE ACT. 4. THE IMPUGNED ORDER PASSED BY LD. CIT U/S 263 OF THE ACT BY OBSERVING CERTAIN DEFECTS IN THE ASSESSMENT ORDER PASSED BY AO U/S. 1 43(3) OF THE ACT. AS PER LD. CIT THE FOLLOWING FACTS HAVE NOT BEEN CONSIDERED BY AO WHILE FRAMING THE ASSESSMENT U/S. 143(3) OF THE ACT:- 1) THERE WAS SERVICE TAX OUTSTANDING TILL 30.09.200 8 FOR AN AMOUNT OF RS.1 37 15 804/- WHICH NEEDS TO BE DISALLOWED AS PE R THE PROVISION OF SEC. 43B OF THE ACT; 2) THE ASSESSEE IN ITS FINANCIAL STATEMENT HAS SHOW N THE LIFE OF HOARDING STRUCTURES OVER A PERIOD OF 3-5 YEARS AS PER ITS AC COUNTING POLICY ON ITEM NO. ITA NO.2065/KOL/2013 & 2122/KOL/2014 A. Y. 2008-09 SELVEL ADVERTISING PVT. LTD. VS. CIT-IV/DCIT CIR-12(2) KOL. PAGE 3 1.4. ACCORDINGLY THE DEPRECIATION WAS TO BE PROVID ED IN THE BOOKS OF ACCOUNT DEPENDING UPON THE ESTIMATED USEFUL LIFE OF THE HOA RDING STRUCTURE. HOWEVER LD. CIT OBSERVED THAT THE ASSESSEE HAS CLAIMED DEPR ECIATION @ 100% ON HOARDING STRUCTURES AMOUNTING TO RS.1 05 24 933/- W HICH IS AGAINST THE PROVISION OF LAW. ACCORDINGLY LD. CIT FURTHER OBSE RVED THAT THE HOARDING STRUCTURES ARE NOT PURELY TEMPORARY STRUCTURES AND THEREFORE THE DEPRECIATION SHOULD BE ALLOWED ON THIS STRUCTURES @ 10% PER ANNU M LIKE NON RESIDENTIAL BUILDINGS. THEREFORE THE EXCESS DEPRECIATION TO TH E TUNE OF RS.1 31 90 323/- [14191130 (10% OF 58 25 005 + 50% OF 10%) 83 66 1 25/-] WAS ALLOWED IN THE ASSESSMENT ORDER FRAMED U/S.1 43(3) OF THE ACT. IN VIEW OF THE ABOVE NOTICE WAS ISSUED TO THE ASSE SSEE U/S 263 OF THE ACT FOR SEEKING THE EXPLANATION WHY THE ORDER OF AO SHOULD NOT BE H ELD AS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE. IN COMPLIANCE TO THE NO TICE ASSESSEE SUBMITTED THAT AS UNDER:- A) NON-PAYMENT OF SERVICE TAX AMOUNTING TO RS.1 37 15 804/- THE ASSESSEE SUBMITTED THAT AS PER THE SEC.145A OF THE ACT THE T URNOVER INCLUDES SALES TAX EXCISE DUTY BUT IT DOES NOT INCLUDE THE SERVICE TAX . THE ASSESSEE IS A SERVICE PROVIDER AND MERELY ACTING AS AGENT OF THE GOVT. FO R THE COLLECTION AND PAYMENT OF SERVICE TAX TO GOVERNMENT. THE ASSESSEE IS NOT E NTITLED TO CLAIM DEDUCTION ON ACCOUNT OF SERVICE TAX. THE ASSESSEE ALSO SUBMITTED THAT THE LIABILITY TO MAKE THE PAYMENT OF SERVICE TAX ARISE WHEN THE SERVICE PROVI DER HAS RECEIVED THE PAYMENT AS SUCH THERE IS NO LIABILITY TO MAKE THE P AYMENT TO THE ACCOUNT OF CENTRAL GOVT. UNTIL AND UNLESS THE PAYMENT IS RECEI VED FROM THE PARTY CONCERNED AS PER THE RULE-6 OF SERVICE TAX RULES 1 994. THE ASSESSEE ALSO SUBMITTED THAT THERE WAS NO DEBIT IN THE PROFIT AND LOSS A/C OF ASSESSEE AND NO CREDIT IN THE PROFIT AND LOSS A/C OF ASSESSEE ON AC COUNT OF SERVICE LIABILITY. THEREFORE THERE WAS NO MISTAKE IN THE ASSESSMENT O RDER AND NO ADDITION IS REQUIRED TO BE MADE. ITA NO.2065/KOL/2013 & 2122/KOL/2014 A. Y. 2008-09 SELVEL ADVERTISING PVT. LTD. VS. CIT-IV/DCIT CIR-12(2) KOL. PAGE 4 B) REGARDING DEPRECIATION THE ASSESSEE SUBMITTED T HAT NECESSARY DETAILS WITH REGARD TO DEPRECIATION CLAIMED ON THE TEMPORARY STR UCTURES HAD BEEN FURNISHED AT THE TIME OF ASSESSMENT PROCEEDINGS. IT WAS SUBMI TTED THAT 100% DEPRECIATION WAS ALLOWED IN THE COURSE OF FIRST ASSESSMENT YEAR OF ASSESSEE I.E. AY 1972-73 AND THEREAFTER. NO DISALLOWANCE OF DEPRECIATION WAS EVER MADE BY THE AO IN THE ASSESSMENT PROCEEDINGS. THE ASSESSEE FURTHER SU BMITTED THAT THE USEFUL LIFE OF THE HOARDING STRUCTURES WERE DETERMINED ON THE B ASIS OF TECHNICAL CERTIFICATE GIVEN BY THE CHARTERED ENGINEERS. BUT IT HAS NOTHIN G TO DO WITH THE PROVISIONS SPECIFIED UNDER THE INCOME TAX ACT. THE ASSESSEE IS ENTITLED TO CLAIM THE DEPRECIATION UNDER THE IT ACT IN SPITE OF THE FACT THAT NO DEPRECIATION WAS CHARGED BY THE ASSESSEE IN ITS BOOKS OF ACCOUNT. HOWEVER THE LD. CIT(A) HAS REJECTED THE PLEA OF AS SESSEE BY OBSERVING THAT THE PAYMENT OF SERVICE TAX IS GOVERNED BY THE PROVISION OF SEC. 43B OF THE ACT AND THEREFORE IT IS NOT ALLOWED WHILE FRAMING THE ASSES SMENT U/S. 143(3) OF THE ACT. SIMILARLY LD. CIT OBSERVED THAT 100% DEPRECIATION HAS BEEN ALLOWED ON THE BASIS OF ORDER PASSED FOR AY 1972-73 AND ALSO SUBSEQUENT AYS ALSO. BUT THE LD. CIT FURTHER OBSERVED THAT THERE WAS A HUGE DIFFERENCE IN THE TE CHNOLOGY AND LIFE OF HOARDING STRUCTURE. THEREFORE THE ASSESSMENT ORDER PASSED I N AY 1972-73 HAS NO BEARING IN THE INSTANT CASE. ACCORDINGLY LD. CIT HELD THE ORDER O F AO IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE AND HE DIRECTED THE AO T O LOOK INTO THE MATTER AFRESH AND PASS NECESSARY ORDER AS PER LAW. AGGRIEVED ASSESSEE PREFERRED AN APPEAL BEFORE US. 5. BEFORE US LD. AR FILED TWO SETS OF PAPER BOOK ONE WHICH IS RUNNING PAGES FROM 1 TO 70 AND SUPPLEMENTARY PAPER BOOK WHICH IS RUNNING PAGES 1 TO 108 PAGES AND STATED THAT THE ISSUE OF STATUTORY PAYMENT OF T AX LIABILITY AND OTHER PAYMENTS ACCORDING TO SEC.43B OF THE ACT HAS BEEN DULY INVES TIGATED BY THE AO AT THE TIME OF ASSESSMENT PROCEEDINGS. HE IN SUPPORT OF ASSESSEES CLAIM DREW OUR ATTENTION TO THE QUERY RAISED BY THE AO U/S. 142(1) OF THE ACT AT TH E TIME OF ASSESSMENT WHICH IS ITA NO.2065/KOL/2013 & 2122/KOL/2014 A. Y. 2008-09 SELVEL ADVERTISING PVT. LTD. VS. CIT-IV/DCIT CIR-12(2) KOL. PAGE 5 PLACED ON PAGE 49 OF ITEM NO 18 OF THE PAPER BOOK. LD. AR ALSO DREW OUR ATTENTION ON PAGE 51 OF THE PAPER BOOK WHERE THE REPLY FOR THE S TATUTORY PAYMENTS OF TAX LIABILITY ACCORDING TO SEC. 43B OF THE ACT WAS PLACED. LD. AR OF THE ASSESSEE ACCORDINGLY SUBMITTED THAT THE MATTER OF THE SERVICE TAX LIABIL ITY HAS BEEN DULY INVESTIGATED BY THE AO AT THE TIME OF ASSESSMENT PROCEEDINGS AND THEREF ORE ON THIS GROUND THE ORDER OF AO CANNOT BE HELD AS ERRONEOUS AND PREJUDICIAL TO T HE INTEREST OF REVENUE. LD. AR OF ASSESSEE ALSO DREW OUR ATTENTION ON PAGE 7 OF THE S UPPLEMENTARY PAPER BOOK WHERE THE NECESSARY DETAILS FOR THE PAYMENT ACCORDING TO SEC. 43B OF THE ACT WERE FURNISHED IN THE FORM OF TAX AUDIT REPORT. FURTHER LD. AR SUBMI TTED THAT THE SERVICE TAX HAS NOT BEEN SHOWN AS INCOME IN THE PROFIT AND LOSS A/C AND SIMILARLY NO EXPENSES WITH REGARD TO SERVICE TAX HAS BEEN CLAIMED IN THE PROFIT AND L OSS A/C OF ASSESSEE. LD. AR IN SUPPORT OF ASSESSEES CLAIM HAS DRAWN OUR ATTENTION ON PAGES 46 OF THE SUPPLEMENTARY PAPER BOOK WHERE THE PROFIT AND LOSS A/C OF ASSESSE E WAS PLACED. LD. AR IN SUPPORT OF ASSESSEES CLAIM ALSO RELIED IN THE CASE OF CIT VS. NOBLE AND HEWITT (I) P. LTD. (2008) 305 ITR 324 (DEL) WHERE THE HON'BLE COURT HELD:- THE ASSESSEE MAINTAINED ITS ACCOUNTS ON THE MERCAN TILE SYSTEM OF ACCOUNTING. IT HAD COLLECTED SERVICE TAX DURING THE PREVIOUS YE AR RELEVANT TO THE ASSESSMENT YEAR 1999-2000. OUT OF THE SERVICE TAX SO COLLECTED IT HAD DEPOSITED PART OF THE AMOUNT BUT AN AMOUNT OF RS.14.40 LAKHS WAS NOT DEPO SITED BY IT WITH THE CONCERNED AUTHORITIES. THE ASSESSEE DID NOT CLAIM A NY DEDUCTION IN THIS REGARD NOR DID IT DEBIT THE AMOUNT AS AN EXPENDITURE IN TH E PROFIT AND LOSS ACCOUNT. THE ASSESSING OFFICER AS WELL AS THE COMMISSIONER ( APPEALS) NEVERTHELESS DISALLOWED THE AMOUNT AND ADDED IT BACK TO THE INCO ME OF THE ASSESSEE. THE TRIBUNAL SET ASIDE THE ORDER. ON APPEAL TO THE HIGH COURT: HELD DISMISSING THE APPEAL THAT SINCE THE ASSESS EE DID NOT DEBIT THE AMOUNT TO THE PROFIT AND LOSS ACCOUNT AS AN EXPENDI TURE NOR CLAIM ANY DEDUCTION IN RESPECT OF THE AMOUNT AND CONSIDERING THAT THE ASSESSEE WAS FOLLOWING THE MERCANTILE SYSTEM OF ACCOUNTING THE QUESTION OF DISALLOWING THE DEDUCTION NOT CLAIMED WOULD NOT ARI SE. FURTHER LD. AR OF ASSESSEE WITH REGARD TO DEPRECIA TION ON HOARDING STRUCTURES SUBMITTED THAT ASSESSING OFFICER HAS RAISED SPECIFI C QUERY FOR THE DEPRECIATION CLAIMED ON THE HOARDING STRUCTURES. THE QUERY RAISED BY THE AO AT THE TIME OF ASSESSMENT IS PLACED ON PAGE 53 OF THE PAPER BOOK THE ASSESSEE IN RESPONSE TO THE QUERY RAISED BY AO HAS SUBMITTED THE DETAILED REPLY WHICH IS PLACED ON PAGE 55 OF THE PAPER BOOK. HE ITA NO.2065/KOL/2013 & 2122/KOL/2014 A. Y. 2008-09 SELVEL ADVERTISING PVT. LTD. VS. CIT-IV/DCIT CIR-12(2) KOL. PAGE 6 REQUESTED THE BENCH TO ALLOW THE ASSESSMENT ORDER A ND QUASH THE IMPUGNED ORDER PASSED BY LD. CIT. ON THE OTHER HAND LD. DR WITH REGARD TO THE SERVIC E TAX ISSUE SUPPORTED THE ORDER OF THE LD. CIT. WITH REGARD TO DEPRECIATION CLAIMED BY ASSESSEE @ 100% ON HOARDING STRUCTURES IT WAS SUBMITTED THAT THE ORDER OF AY 1 972-73 WAS PASSED 40 YEARS BACK. THEE MUST HAVE BEEN CHANGES IN THE HOARDING STRUCTU RES THEREFORE THE FACTS SHOULD BE LOOKED AFRESH WHILE ALLOWING 100% DEPRECIATION ON T HE HOARDING STRUCTURES. AS PER THE ACCOUNTING POLICY OF THE ASSESSEE THE USEFUL LIFE OF HOARDING STRUCTURE HAS BEEN DETERMINED OVER A PERIOD OF 3-5 YEARS. LD. FINALLY THE LD. DR VEHEMENTLY SUPPORTED THE ORDER PASSED BY LD. CIT U/S. 263 OF THE ACT. 6. WE HAVE HEARD THE RIVAL CONTENTIONS OF BOTH THE PARTIES AND PERUSED THE MATERIALS AVAILABLE ON RECORD. FROM THE FOREGOING D ISCUSSION WE FIND THAT LD. CIT HAS HELD THE ORDER OF AO AS ERRONEOUS IN SO FAR AS PREJ UDICIAL TO THE INTEREST OF REVENUE ON ACCOUNT OF TWO REASONS FIRSTLY SERVICE TAX AMOUNT HAS NOT BEEN PAID ON OR BEFORE FILING THE IT RETURN AS MANDATED UNDER THE PROVISIO N OF SEC. 43B OF THE ACT. SECONDLY THE AO AT THE TIME OF ASSESSMENT HAS ALLOWED THE DE PRECIATION @ 100% ON THE HOARDING STRUCTURE. NOW THE QUESTION BEFORE US ARIS E WHETHER THE IMPUGNED ORDER PASSED BY LD CIT U/S 263 OF THE ACT IS ERRONEOUS AN D PREJUDICIAL TO THE INTEREST OF REVENUE IN THE AFORESAID FACTS AND CIRCUMSTANCES OF THE CASE. AS PER THE SERVICE TAX LAW SERVICE TAX IS PAYABLE AS AND WHEN THE PAYMENT /FEES FOR UNDERLYING SERVICE PROVIDED ARE REALIZED. AS THE APPELLANT FIRM HAS NO T RECEIVED THE SUM TILL THE END OF THE FINANCIAL YEAR I.E. 2007-08 THE QUESTION OF PAYING THE SAME DID NOT ARISE AT ALL. AS ALREADY STATED THE FACT OF NON-REALIZATION OF FEES IS DISPUTED BY THE AO IN HIS ORDER. IF FOR ANY REASON THE PAYMENT FOR SERVICES RENDERED IS NOT REALIZED (BAD DEBTS) THERE WAS NO LIABILITY AS TO PAYMENT OF SERVICE TAX. THUS SER VICE TAX LAW STANDS ON A DIFFERENT FOOTING AS COMPARED TO OTHER LAWS LIKE CENTRAL EXCI SE OR VAT. AS PER THE PROVISIONS OF SECTION 145A OF THE INCOME-TAX ACT 1961 TAXES A ND DUTIES SHOULD FORM PART OF THE GROSS RECEIPTS BUT IT AS APPLICATION IS RESTRICTED TO PURCHASE AND SALE OF GOODS ONLY AND DOES NOT EXTEND TO SERVICE CONTRACTS. THUS THE LIABILITY OF THE SERVICE TAX DOS NOT ITA NO.2065/KOL/2013 & 2122/KOL/2014 A. Y. 2008-09 SELVEL ADVERTISING PVT. LTD. VS. CIT-IV/DCIT CIR-12(2) KOL. PAGE 7 ALSO ARISE AS PER SECTION 145A OF THE ACT. THE PROV ISIONS OF SECTION 145A OF THE INCOME-TAX ACT 1961 THAT READ AS UNDER:- NOTWITHSTANDING ANYTHING TO THE CONTRARY CONTAINED IN SECTION 145 (A)THE VALUATION OF PURCHASE AND SALE OF GOODS) AN D INVENTORY FOR THE PURPOSES OF DETERMINING THE INCOME CHARGEABLE UNDER THE HEAD PROFITS AND GAINS OF BUSINESS FOR PROFESSION SHALL BE- (I) IN ACCORDANCE WITH THE METHOD OF ACCOU9NTING RE GULARLY EMPLOYED BY THE ASSESSEE; AND (II) FURTHER ADJUSTED TO INCLUDE THE AMOUNT OF ANY TAX DUTY CESS OR FEE (BY WHATEVER NAME CALLED) ACTUALLY PAID OR INCURRED BY THE ASSESSEE TO BRING THE GOODS TO THE PLACE OF ITS LOCATION AND CONDITION AS ON THE DATE OF VALUATION. IT IS CLEAR FROM THE ABOVE PROVISIONS THAT IT APPLI ES ONLY IN RESPECT OF VALUATION OF PURCHASE AND SALE OF GOODS AND INVENTORY AND NOT TO SERVICE CONTRACTS. THEREFORE THE ACTION OF THE ASSESSING OFFICER IN INVOKING PROVISI ONS OF SECTION 145A OF THE ACT AND ADDING SERVICE TAX TO GROSS RECEIPTS IS INCORRECT I N AS MUCH AS AGAINST THE VERY BASIC PRINCIPLES OF SECTION 145A. APART FROM THE ABOVE WE FIND THAT THE PAYMENT FOR SERVICES RENDERED WAS NOT RECEIVED IN THE FINANCIAL YEAR UNDER CONSIDERATION. THE PROV ISIONS OF SECTION 43B OF THE ACT READS AS UNDER:- NOTWITHSTANDING ANYTHING CONTAINED IN ANY OTHER PR OVISION OF THIS ACT A DEDUCTION OTHERWISE ALLOWABLE UNDER THIS ACT IN RES PECT OF- (A) ANY SUM PAYABLE BY THE ASSESSEE BY WAY OF TAX DUTY CESS OR FEE BY WHATEVER NAME CALLED UNDER ANY LAW FOR THE TIME BE ING IN FORCE OR (B). READING OF THIS SECTION MAKES IT CLEAR THAT ANY DED UCTION CLAIMED OF ANY AMOUNT PAID BY WAY OF ANY TAX DUTY CESS ETC. WILL BE ALLOWED ONLY IF THE SAID SUM IS PAID. IN THE PRESENT CASE THE LIABILITY TO PAY SERVICE TAX ITSEL F HAS NOT CRYSTALLIZED OWING TO NON RECEIPT OF PAYMENT. THUS THE QUESTION OF CLAIMING DEDUCTION OF SUCH TAX DOES NOT ARISE. THE CHENNAI BENCH OF ITAT IN THE CASE OF ASS ISTANT COMMISSIONER OF INCOME- TAX MEDIA CIRCLE-II CHENNAI V. REAL IMAGE MEDIA T ECHNOLOGIES (P) LTD. [2008] 114 ITD 573 (CHENNAI) HAD AN OCCASION TO EXAMINE IDENTI CAL CASE IT WAS HELD THAT THE RIGOR OF THE PROVISION OF SECTION 43B WOULD BE ATTR ACTED ONLY TO A CASE WHERE AN ITEM ITA NO.2065/KOL/2013 & 2122/KOL/2014 A. Y. 2008-09 SELVEL ADVERTISING PVT. LTD. VS. CIT-IV/DCIT CIR-12(2) KOL. PAGE 8 IS ALLOWABLE AS DEDUCTION BUT BECAUSE OF THE FAILUR E TO MAKE PAYMENT SUCH DEDUCTION WOULD NOT BE ALLOWED. THE RIGOR OF SECTION 43B MIGH T BE APPLICABLE TO THE CASE OF SALES-TAX OR EXCISE DUTY BUT THE SAME COULD NOT BE SAID TO BE THE POSITION IN CASE OF SERVICE-TAX BECAUSE OF TWO REASONS. FIRSTLY THE AS SESSEE IS NEVER ALLOWED DEDUCTION ON ACCOUNT OF SERVICE TAX WHICH IS COLLECTED ON BEHAL F OF THE GOVERNMENT AND IS PAID TO THE GOVERNMENT ACCOUNT ACCORDINGLY. THEREFORE A S ERVICE PROVIDER IS MERELY ACTING AS AN AGENT OF THE GOVERNMENT AND IS NOT ENTITLED TO CLAIM DEDUCTION ON ACCOUNT OF SERVICE TAX. HENCE ON THIS ACCOUNT ALONE ADDITION U NDER SECTION 43B COULD NOT HAVE BEEN MADE. SECONDLY SECTION 43B(A) USES THE EXPRES S ON ANY SUM PAYABLE. FOR MAKING ANY DISALLOWANCE FIRST OF ALL IT HAS TO BE ESTABLISHED THAT SUCH SUM IS PAYABLE. THE WORD PAYABLE USED IN SECTION 43B MEANS THAT T HERE IS A KIND OF OBLIGATION ON THE PART OF PAYEE TO MAKE THE PAYMENT WHICH IS ALREADY DUE. A PLAIN READING OF RULE 6 OF THE SERVICE TAX RULES WOULD SHOW THAT SERVICE PROVI DER BECOMES LIABLE TO MAKE THE PAYMENT OF SERVICE TAX BY THE 5TH OF THE MONTH IMME DIATELY FOLLOWING THE CALENDAR MONTH IN WHICH THE PAYMENTS ARE RECEIVED TOWARDS TH E VALUE OF TAXABLE SERVICE. THE FIRST PROVISO PROVIDES FOR AN EXCEPTION IN CASE OF INDIVIDUALS OR PROPRIETARY FIRMS OR PARTNERSHIP FIRMS AND IN SUCH CASES SERVICE TAX H AS TO BE PAID TO THE CREDIT OF THE CENTRAL GOVERNMENT BY THE 5TH OF THE MONTH IMMEDIAT ELY FOLLOWING THE QUARTER OF CALENDAR YEAR IN WHICH THE PAYMENTS ARE RECEIVED. T HE ONLY DIFFERENCE IS THAT IN CASE OF INDIVIDUAL OR PROPRIETARY OR PARTNERSHIP FIRM P AYMENT HAS TO BE MADE ON 5TH OF THE FOLLOWING MONTH AFTER THE FOLLOWING QUARTER OF CALE NDAR YEAR WHEREAS IN THE CASE OF OTHER ORGANIZATIONS IT HAS TO BE PAID ON THE 5TH OF THE MONTH IMMEDIATELY FOLLOWING THE CALENDAR MONTH. BUT IN BOTH THE CASES THE LIAB ILITY ARISES TO MAKE THE PAYMENT ONLY AFTER THE SERVICE PROVIDER HAS RECEIVED THE PA YMENTS. IF THERE IS NO LIABILITY TO MAKE THE PAYMENT TO THE CREDIT OF THE CENTRAL GOVER NMENT BECAUSE OF NON-RECEIPT OF PAYMENTS FORM THE RECEIVER OF THE SERVICES THEN IT CANNOT BE SAID THAT SUCH SERVICE TAX HAS BECOME PAYABLE IN TERMS OF CLAUSE. IN THIS CONN ECTION WE ALSO RELIED IN THE JUDGMENT OF HON'BLE DELHI HIGH COURT IN THE CASE OF NOBLE AND HEWITT (I) P. LTD. (SUPRA). ITA NO.2065/KOL/2013 & 2122/KOL/2014 A. Y. 2008-09 SELVEL ADVERTISING PVT. LTD. VS. CIT-IV/DCIT CIR-12(2) KOL. PAGE 9 SIMILARLY FOR THE ISSUE RAISED FOR THE DEPRECIATION CLAIMED @ 100% ON THE HOARDING STRUCTURE WE FIND THAT THE HOARDING STRUCTURES ARE TEMPORARY IN NATURE AND THEY CANNOT BE EQUATED WITH THE BUILDING FOR THE REASON THAT TH E TEMPORARY STRUCTURES ARE RAISED IN TEMPORARY LOCATION WHICH ARE TAKEN ON LEASE ONCE THE STRUCTURES ARE REMOVED THE VALUE BECOMES ALMOST NIL AND CANNOT BE USED AGAIN. IN THIS CONNECTION WE ALSO RELY THE ORDER OF CO-ORDINATE BENCH OF THIS TRIBUNAL IN B IN ITA NO.657 TO 659/KOL/2011 FOR AY 06-07 TO 08-09 DATED 01.01.2015 THE RELEVA NT OPERATIVE PORTION OF THE SAID ORDER IS REPRODUCED BELOW:- .. FROM ARGUMENTS OF BOTH THE SIDES AND CONSID ERING THE APPELLATE ORDER WE ARE OF THE VIEW THAT THE LED VIDEO DISPLAY BOARD S ARE TEMPORARY STRUCTURES AND THEY CANNOT BE EQUATED WITH PLANT AN D MACHINERY FOR THE REASON THAT THESE STRUCTURES ARE DISPLAYED OUTSIDE IN TEMP ORARY LOCATIONS AND ON LAND TAKEN ON LEASE FOR A TEMPORARY PERIOD. ONCE YOU DIS MANTLE THESE TEMPORARY STRUCTURES IT WILL REDUCE ITS VALUE TO ALMOST NIL AND IT CANNOT BE USED SECOND TIME OR THIRD TIME AND LIFE SPAN OF LED VIDE DISPLA Y BOARDS IS ALSO NOT MORE THAN 6 MONTHS TO 1 YEAR. THE LAND IS NEITHER OWNED BY THE ASSESSEE NOR IT IS HELD BY ASSESSEE ON LEASE BASIS. THE STRUCTURES PUT ON SUCH AND WHATEVER IN NATURE ARE PURELY TEMPORARY STRUCTURES. EVEN SOMET IMES THESE STRUCTURES ARE NOT TAKEN BY THE ASSESSEE FOR RE-USE AGAIN. WHEN SU CH STRUCTURES RE PUT ON LAND NOT BELONGING TO ASSESSEE THE EXPENDITURE IS HELD TO BE THE NATURE OF REVENUE IN VIEW OF THE JUDGMENT OF HON'BLE SUPREME COURT IN TH E CASE OF CIT VS. MADRAS AUTO SERVICE P T. LTD. (1998) 233 ITR 468 (SC). IN VIEW OF THE ABOVE WE CONFIRM THE ORDER OF CIT(A) AND THIS ISSU9E OF REVE NUES APPEAL IS DISMISSED. RESPECTFULLY FOLLOWING THE PRECEDENTS AS ABOVE WE HOLD THAT THE IMPUGNED REVISION ORDER IS UNSUSTAINABLE IN LAW AND WE THEREFORE CA NCEL THE SAME. THIS GROUND OF ASSESSEES APPEAL IS ALLOWED. 7. IN THE RESULT ASSESSEES APPEAL IS ALLOWED. COMING TO REVENUES APPEAL IN ITA NO.2122/KOL/2014 FOR A.Y. 08-09 . 8. REVENUE HAS RAISED FOLLOWING GROUNDS:- 1. THAT IN THE FACTS OF THE CASE AND IN THE LAW T HE LD. CIT(A) ERRED BY DELETING THE ADDITION OF RS.1 37 15 804/- SERVICE T AX TO THE TUNE OF RS.1 37 15 804/- REMAINING UNPAID TILL DUE DATE OF FILING OF RETURN OF INCOME. AS THE ASSESSEE HAD RECEIVED/REALIZED SERVICE TAX TO T HE TUNE OF RS.1 37 15 804/- DURING THE YEAR BUT FAILED DISCHARGE THE LIABILITY TO MAKE PAYMENT OF SUCH SERVICE TAX BEFORE THE DUE DATE OF FILING OF RETURN OF INCOME. 2. THAT IN THE FACTS OF THE CASE AND IN THE LD. CI T(A) ERRED BY DELETING THE ADDITION OF EXCESS DEPRECIATION CLAIMED OF RS.1 31 90 324/- WITHOUT ITA NO.2065/KOL/2013 & 2122/KOL/2014 A. Y. 2008-09 SELVEL ADVERTISING PVT. LTD. VS. CIT-IV/DCIT CIR-12(2) KOL. PAGE 10 APPRECIATING THAT THE BENEFIT ENJOYING BY THE ASSES SEE IS OF ENDURING NATURE OVER A PERIOD OF TIME. 9. AT THE OUTSET WE FIND THAT BOTH THE COMMON ISSUE S RAISED BY THE REVENUE ARE ALLOWED IN FAVOUR OF THE ASSESSEE IN PARAGRAPH NO. 6 OF THIS ORDER IN ITA NO. 2065/KOL/2013. FOLLOWING THE SAME WE DISMISS BOTH THE ISSUE RAISE BY REVENUE IN ITS APPEAL 10. IN THE RESULT ASSESSEES APPEAL STANDS ALLOWED AND THAT OF REVENUE IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 30/09/2016 SD/- SD/- (K.NARSIMHA CHARY) (WASEEM AHMED) JUDICIAL MEMBER ACCOUNTANT MEMBER *DKP '#$ - 30/09/2016 / KOLKATA / COPY OF ORDER FORWARDED TO:- 1. /ASSESSEE-SELVEL ADVERTISING PVT. LTD. C/O M.L. SAH GAL & CO. NEELAM APARTMENTS 3 RD FLOOR FLAT 3E 61-B PARK STREET KOLKATA-16 2. /REVENUE-CIT KOL-IV P-7 CHOWRINGHEE SQURE /DCIT CIRCLE-12(2) 7 TH FLOOR P-7 CHOWRINGHEE SQ. KOLKATA-69 3. ##%& ' / CONCERNED CIT 4. ' - / CIT (A) 5. ()* ++%& %& / DR ITAT KOLKATA 6. * - / GUARD FILE. BY ORDER/ /TRUE COPY/ / # %&