Assessee held entitled to deduction of Tax on payment u/s 43B (of Income Tax Act, 1961), ITAT
Assessee held entitled to deduction of Tax on payment u/s 43B (of Income Tax Act, 1961), ITAT
Assessee Co.mfd. Steel Semies, Silica Manganese etc. It filed return. AO in assessment determined loss & book profit on normal proviso. On appeal CIT(A) found that sum of Rs.27,92,456/- was debited by assessee in P&L a/c on account of "Input VAT reversal". On appeal ITAT held, assessee was entitled for deduction of such tax on payment basis u/s 43B (of Income Tax Act, 1961). Court, therefore, deleted addition made by AO & confirmed by ld. CIT(A). Assesse's appeal allowed.-501275
Facts in brief:
1. Assessee Company is engaged in the business of manufacturing of Steel Semies, Silica Manganese and Hot Rolled products.
2. The return of income for the year under consideration was filed by it declaring loss book profit under section 115JB (of Income Tax Act, 1961).
3. In the assessment originally completed under section 143(3) (of Income Tax Act, 1961) vide an I . T. A . N o. 1 0 4 7 / KO L . / 2 0 1 5 Assessment year: 2009-2010 order dated 24.10.201, loss under the normal provisions was determined by the Assessing Officer at Rs.21,83,002/- and book profit at Rs.8,80,096/-.
4. On appeal, CIT(Appeals) and on such examination, he found that a sum of Rs.27,92,456/- was debited by the assessee in the Profit & Loss Account on account of "Input VAT reversal".
5. According to him, the said amount was not allowable as deduction since the VAT accounts were maintained separately by the assesese-company and the order passed by the Assessing Officer under section 143(3) (of Income Tax Act, 1961) allowing the said deduction was erroneous as well as prejudicial to the interest of the revenue. He, therefore, issued a show-cause notice under section 263 (of Income Tax Act, 1961).
6. According to the ld. CIT(Appeals), this stand taken by the assessee required verification and accordingly setting aside the order passed by the Assessing Officer under section 143(3) (of Income Tax Act, 1961) by exercising his powers under section 263 (of Income Tax Act, 1961), he directed the Assessing Officer to verify the stand of the assesese from the relevant record.
7. CIT confirmed the disallowance made by the Assessing Officer.
On appeal ITAT held,
8. Assessment year: 2009-2010 consideration, the assessee, in my opinion, was entitled for deduction of such tax on payment basis under section 43B (of Income Tax Act, 1961). I, therefore, delete the addition made by the Assessing Officer and confirmed by the ld. CIT(Appeals) on this issue and allow this appeal of the assessee.
9. In the result, the appeal of the assessee is allowed.
Case Reference-Bdg Metal And Power Ltd., Kolkata vs Assessee
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