Orient Overseas Container Line Limited ... vs Deputy Commissioner Of Income Tax ... on 25 June, 2025
DRP is that amendment in the provisions of Section 145A of
the Act brought by Finance Act 2018, since it includes
"services" within its code therefore, income has to be
computed in accordance with Section 145A and any taxes
levied under services is included and for that heavy reliance
has been placed on the judgment of Hon'ble High Court of
Bombay in the case of Knight Frank (India) Pvt. Ltd. (supra).
However the Hon'ble Court held that Section 145A restricts its
ambit only to valuation of purchase and sale of goods in
inventory and would not apply to service tax billed on
rendering of service as service tax billed has no relation to any
goods nor does it have anything to do with bringing goods to a
particular location. Section 145A which is for the method of
accounting which starts with' for the purpose of determining
the income chargeable under the head 'Profits and gains of
10
ITA No.2129/Mum/2025
Assessment Year 2022-2023
business or profession', being a general provision, would not
apply to the special provisions of Section 44B of the Act.
Further, the words "For the purpose of determining the income
chargeable under the head "Profits and gains of business for
profession...." in section 145A signifies that the essence of
section is to compute income under the head profits and gains
of business or profession which is computed as per provisions
of Section 29 of the Act. On the contrary, provisions of Section
44B (1) starts with a non obstante clause "Notwithstanding
anything to the contrary contained in sections 28 to 43A....".
Since Section 44B overrides the provisions of Section 29 of the
Act, therefore in our opinion Section 145A is not applicable for
computing deemed income under Section 44B.