GST not includible in Gross Receipts for Income Computation U/S 44BB: ITAT Mumbai
Oceaneering International GMBH Vs DCIT (International Taxation) (ITAT Mumbai) (te 2 ITA no. 4670/MUM/2023)
Facts:
1. The assessee, a non-resident company registered in Switzerland, is engaged in the business of providing equipment and service for use in oil and gas drilling operation to various companies engaged in oil and gas exploration activities in India.
2.It filed its return of income for the impugned assessment year 2021-22 offering income to tax on presumptive basis in accordance with Section 44 BB of the Income Tax Act.
3.AO observed that the assessee has received payment on account of GST which has not been included under the gross receipts which have been offered to tax u/s. 44 BB.
4.Accordingly, the amount of Rs. 13,10,09,191/- was brought to tax as part of gross receipts for the purposes of presumptive income u/s. 44 BB. DRP upheld action of AO. Being aggrieved, the present appeal is filed.
ITAT Mumbai held as below:
1. GST being a mandatory ‘statutory levy’ cannot be said to be in the nature of ‘charges’.
2. GST would not form part of gross receipts for the purposes of computing income under Section 44BB of the Act and the AO is hereby directed to exclude the amount of Rs 13,10,09,191/-towards GST while computing gross receipts in hands of the assessee.
3. In the result, ground of the assessee is allowed.
The copy of the order is as under:
