service tax paid allowable

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CA CS VINAYAK PATIL (Querist)
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28 March 2009 If last year service tax is disallowed and this year service tax deposited and claim will it allowed. if yes then please send me any case in favour of assessee who have claim service tax

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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28 March 2009 If the service provider is maintaining mercantile system of accounting, collected service tax but did not deposit thereof to Government account, but had neither debited the amount to the p&l a/c as an expenditure nor had claimed any deduction in respect of the amount, the question of disallowing any amount under 43B would not arise. Citation:- CIT Vs NOBLE & HEWITT (I) LTD (2008) 166 Taxmann 48 (Delhi).
In view of the above, if it is disallowed in an year it should be allowed as a business expenditure in the subsequent year on payment basis.