| Case ID |
ffeb44c8-0d21-4db2-89fb-0100664afb05 |
| Body |
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| Case Number |
D.B. IT REFERENCE APPLICATION NO. 18 OF 1993 |
| Decision Date |
Feb 04, 2002 |
| Hearing Date |
Feb 04, 2002 |
| Decision |
The Tribunal's decision to allow the assessee's claim of deduction for sales tax paid after the accounting year during the grace period was upheld. The court found no infirmity in the Tribunal's order based on the precedent set by the Supreme Court in Allied Motors (P.) Ltd. v. CIT. The reference was disposed of with the decision in favor of the assessee and against the revenue. |
| Summary |
This case, decided by the Rajasthan High Court, involved the application of Section 43B of the Income-tax Act, 1961, which allows certain business deductions only upon actual payment. The case was brought by the Commissioner of Income Tax against Ashok Mahendra & Co., with the primary issue concerning the deduction of sales tax collected but not paid during the accounting year. The Tribunal had allowed the deduction, as the sales tax was paid before the due date for filing the return, despite being paid after the close of the accounting year. The decision was based on the precedent set by the Supreme Court in Allied Motors (P.) Ltd. v. CIT, which held that the first proviso to Section 43B is retrospective and allows such deductions if payment is made before the filing deadline. The Rajasthan High Court upheld the Tribunal's decision, finding no error in law, and ruled in favor of the assessee. The case highlights the importance of understanding amendments and their retrospective application in tax law, which can significantly impact business deductions and financial accounting practices. This decision is crucial for tax professionals and businesses dealing with similar issues, as it clarifies the application of Section 43B regarding sales tax deductions. Keywords: Section 43B, Income-tax Act, business deductions, sales tax, accounting year, retrospective application, Supreme Court precedent. |
| Court |
Rajasthan High Court
|
| Entities Involved |
Commissioner of Income Tax,
Ashok Mahendra & Co.
|
| Judges |
Y.R. Meena,
A.C. Goyal
|
| Lawyers |
J.K. Singhi,
J.K. Ranka
|
| Petitioners |
Commissioner of Income Tax
|
| Respondents |
Ashok Mahendra & Co.
|
| Citations |
2004 SLD 2368,
2004 268 ITR 500
|
| Other Citations |
Allied Motors (P.) Ltd. v. CIT [1997] 224 ITR 677,
CIT v. Chandulal Venichand [1994] 209 ITR 7,
CIT v. Sri Jagannath Steel Corpn. [1991] 191 ITR 676,
Jamshedpur Motor Accessories Stores v. Union of India [1991] 189 ITR 70
|
| Laws Involved |
Income-tax Act, 1961
|
| Sections |
43B
|